Posted on 11/29/2006 8:46:56 AM PST by GodGunsGuts
Dollar woes poised to carry over into next year
Greenback is down about 50% vs. euro in past five years; down 6% vs. yen
By Wanfeng Zhou, MarketWatch
Nov 28, 2006
NEW YORK (MarketWatch) -- After a precipitous slide in the last week that caught many traders off guard, the dollar is vulnerable to further losses and may continue to weaken against major rivals heading into 2007, analysts said Tuesday.
"Sentiment for the dollar has been deteriorating steadily over recent weeks," said Mitul Kotecha, head of global foreign-exchange strategy at French investment bank Calyon. The decline was not prompted by a particular piece of news or data release, "but rather a general worsening in sentiment that saw long held technical levels breached," he said.
"We expect the dollar to weaken further into year end, and retain this tone in the early months of 2007," he said.
The greenback has certainly come under fire in the past week, with the euro pushing through $1.30 on Friday for the first time since April 2005 and the British pound hitting its highest level since Dec. 2004. Traders at first attributed the sharp move to a lack of liquidity with many market players absent for the Thanksgiving holiday.
But the dollar has continued to fall this week and analysts are citing a variety of factors as reasons for the slide, including the U.S. government's reduced expectations for economic growth, worries over the narrowing interest-rate differential between the U.S. and other economies, continued talk of reserve diversification by central banks worldwide, and a warning from China about the risk to Asian currency reserves from further dollar declines...
(Excerpt) Read more at marketwatch.com ...
This just makes our products cheaper for the Euro-weenies.
Yes... The Democrats are that scary... :-( /sarc
ping
The systematic collapse of the dollar continues.
I am reminded too of the idea that a declining dollar also forces the Chinese to loosen their peg.
The press will make a big deal out of the decline. The intellectuals will swear it's doomsday. The goldbugs will be out in swarms.
Mean time, cool hands are at the tiller, even when the seas are rough.
Amen.
Let the dollar collapse and then let's have a few years of double-digit inflation to erase personal debts at the expense of the bankers who created the mess to begin with. It'll also be good to correct our trade imbalances as foreign goods become more expensive (without tariffs to piss off the free trade worshippers) and our exports become cheaper on the world market. It'll also lessen the value of the $2 trillion of our debt that China is holding.
Free trade=weak dollar.
The bankers created the "personal" debt mess?
Look for a glut of euro-tourists coming to the US in '07.
Fear! Uncertainty! Doubt!
Fiat money!
Run away!
I'm no economist but doesn't this translate to a reduction in the trade deficit? Isn't that a good thing?
New York City should be happy.
More "Tourists".
More Blue chip Real Estate will be sold to foreigners.
You think that'd be a good thing?
It'll also lessen the value of the $2 trillion of our debt that China is holding.
You think China holds $2 trillion of our debt? LOL!
Did you get your info from Jerome Corsi?
How has our trade balance with Europe changed since the dollar dropped over the last 5 years?
Guess there won't be a lot of Americans vacationing in Europe. It was bad enough when we were in Italy (Euro's) and England (pounds) few weeks ago, I beleive at that time Euro's were 1.3 and Pounds were 1.87 spent way tooo much while I was there because of it.
http://www.theglobeandmail.com/servlet/story/RTGAM.20061128.wxrdollar28/BNStory/Business/
Why, has the trade deficit harmed us?
"Why, has the trade deficit harmed us?"
Not if you think this weak dollar is a-okay.
Don't forget to cut COLAs.
Don't forget to cut COLAs.
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