NationStates Jolt Archive

Why? It would seem to be advantageous (to the US) because it means more exports/less imports.

Except we aren't making anything anymore. We will still import, and just pay more.

Provides a good incentive to tackle that oil addiction.

Because it makes oil cost more. While it's nice to export other stuff, the US does import oil, among other things.

Except we aren't making anything anymore. We will still import, and just pay more.
That's clearly not the case. In 2007 the US exported $1.14 trillion worth of goods and services. China exported $1.221 trillion, Germany $1.361 trillion.

That puts the US in third place and above Japan.

Anyways, the oil price is the only immediately negative impact I can think of. You guys keep complaining about the trade deficit, a weaker dollar will go a long way towards fixing that.

That's clearly not the case. In 2007 the US exported $1.14 trillion worth of goods and services. China exported $1.221 trillion, Germany $1.361 trillion.

That puts the US in third place and above Japan.

Anyways, the oil price is the only immediately negative impact I can think of. You guys keep complaining about the trade deficit, a weaker dollar will go a long way towards fixing that.

The weaker dollar also helps us against the artificial value of the Chinese yuan.

Why? It would seem to be advantageous (to the US) because it means more exports/less imports.

because you kind of ballesd up the whole shopping trips to New York when those two girls got dragged off to an orphanage and strip searched among other things

also because of the macho hatred of the word weak!!!

It also raises prices here at home, even for domestically-produced stuff.

A weak dollar is not good for a powerful country.

The weaker dollar also helps us against the artificial value of the Chinese yuan.
Not really, because the yuan is still coupled to the US dollar to a significant extent. It'll just fall too (though not by as much because it's really linked to a secret basket of currencies which would include the euro, pound and yen as well).

What you don't want right now is China to give up that peg.

http://media.economist.com/images/20070811/D3207WW0.jpg

Except we aren't making anything anymore. We will still import, and just pay more.

The US is one of the world's biggest exporters. The main concern about the weak dollar is inflation.

That's clearly not the case. In 2007 the US exported $1.14 trillion worth of goods and services.
Yes, yes, I was being hyperbolic. But the things that we do not manufacture anymore (and there are many such categories of goods) we are not suddenly going to be able to start manufacturing again, because industrial plant does not pop up overnight.

Yes, yes, I was being hyperbolic. But the things that we do not manufacture anymore (and there are many such categories of goods) we are not suddenly going to be able to start manufacturing again, because industrial plant does not pop up overnight.
The thing is that manufacturing just isn't necessary. The extra cost of stuff coming in is cancelled out by the extra earnings on the stuff going out. And besides, according to wiki 91% of US exports are industrial supplies (read: chemicals), capital goods (planes, machinery) and consumer goods (cars, pharmaceuticals).

The biggest issue is the inflation that can come from the extra costs of imports, particularly oil. In the long term, those price increases are a good thing because they fix the trade balance. In the short term, they're an issue because it looks like Bernanke has chosen to abandon the idea that the Fed is meant to deal with the stability of money, not the economy.

That's clearly not the case. In 2007 the US exported $1.14 trillion worth of goods and services. China exported $1.221 trillion, Germany $1.361 trillion.

That puts the US in third place and above Japan.

Anyways, the oil price is the only immediately negative impact I can think of. You guys keep complaining about the trade deficit, a weaker dollar will go a long way towards fixing that.

The US is also far larger than most of the other countries on that list, Germany and Japan for example. I doubt the US ranks that highly in per capita terms.

I'm not concerned for a few reasons: first, the dollar may be 'weakened,' but it's far from 'weak.' Second, it'll rebound. Third, like others have said, it does mean good things as far as foreign investment and imports. I might be upset if I were into travel, but I'm not. :p

The US is also far larger than most of the other countries on that list, Germany and Japan for example. I doubt the US ranks that highly in per capita terms.

Germany and Japan have far fewer people to sell to domestically. Sounds like a good reason they'd be exporting more than we do. Our internal economy is massive.

The US is also far larger than most of the other countries on that list, Germany and Japan for example. I doubt the US ranks that highly in per capita terms.
Neither does China, for that matter. Germany and Japan happen to be very export-orientated manufacturing economies (though that's relative - in reality services form the biggest part of their economies as well), the US hasn't been for some time. Instead it's got a large and powerful base of domestic consumers which have been driving the economy. That's not better or worse.

And as far as trade in services (pdf) (http://ita.doc.gov/td/sif/SXUSEOCT2003.pdf) is concerned, the US is a net exporter, I believe.

When Dubya took office, the canadian dollar was with about 67 US cents. Now it's worth about 102 US cents. Therefore, a canadian product which cost $67 US eight years ago now costs $102 US. It'd cost canadians the same $100 canadian the whole time, though.

I'm not saying that the US is dropping like a stone against all currencies, but
a weaker dollar means we simply can't afford as many foreign goods.

It'd cost canadians the same $100 canadian the whole time, though.

Unless Canada has experienced no inflation for seven years this is untrue.