There has been a notable rise in commentary by opinionizers worried by the effects of falling dollar valuation, e.g., Larry Kudlow last Friday, “Save the Greenback, Mr. President” and today, “The Dollar Decline Must End.”
For all the great respect we have for Mr. Kudlow, we’ll go with this column from John M. Berry, a former Washington Post economic reporter who now contributes for Reuters, “Don’t worry about the weak dollar”:
There’s no way to shut off the incessant warnings about a weak dollar from foreign officials and some economists, but it’s perfectly safe to ignore them.
You can also yawn the next time Treasury Secretary Timothy Geithner repeats the mantra, “It is very important to the United States that we continue to have a strong dollar.”
Everybody is blowing smoke.
Those complaining in Europe, Japan, Canada and elsewhere are worried that a cheaper dollar will further damage their already declining exports, making their ailing economies worse.
The reality is that the dollar’s more or less continuous decline against other major currencies since the beginning of 2002 has helped cut in half the huge U.S. deficit in trade and financial transactions with the rest of the world.
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