How Do We Strenghen The Dollar?

[JoDog]

Is there anyone here who can tell me what needs to be done to reverse the dollar's slide and strengthen it? I don't know a lot about economics, and am very curious about this.

[Ichingcarpenter]

1. Stop the War and start producing something other than

fuels the Military Industrial Complex.

[Captain Angry]

2. There has to be demand for the dollar.

If a citizen of a foreign country wants to buy an American product, they have to (effectively) sell their home currency, buy dollars, and buy the product.

While we export a tremendous amount of stuff and services, but we import so much more. Which means we have to sell our dollars, to buy those foreign goods.

Our dependence on oil and inexpensive goods made outside of the USA forces down the dollar. For all the vitriol about money from other countries buying American businesses and infrastructure, it is precisely the kind of thing that should help the dollar, albeit in a very small way.

[Kolesar]

16. Our oil imports are driving the dollar down

There are too many US dollars in the oil producing nations. The manufacturing trade deficit is a similar problem.

[bpeale]

3. stop printing money that isn't backed by anything

[dipsydoodle]

6. You beat me to it

word for word.:toast:

[wildbilln864]

7. Exactly!

Back up the dollar with gold and silver as it was in the days before the FED. :banghead:

[no_hypocrisy]

4. Move the impetus of the economy back to manufacturing and less on

consumerism and service jobs.

Return the tax burden to pre-2001 at least.

Start paying our debts and living within our means.

Find a way to ease out of the war and help Iraq pick up the pieces that we broke.

Prosecute swindlers on Wall Street and in the banks.

[Phx_Dem]

5. Raise the prime lending rate. nt

[ChairmanAgnostic]

11. precisely.

throwing billions of greenbacks, and keeping the rate artificially low is couterproductive and inflationary.

there are ebbs and tides in economies, and it is foolish to try to prevent the natural changes. Almost like trying to stop a hurricane.

[dipsydoodle]

8. If you think now is bad

just wait until the oil producers switch to Euros for payment.

[Big Blue Marble]

9. Strengthen our economy.

Reduce our dependence on foreign oil. And significantly reduce our negative balance of trade with China
and other countries. We are literally hemorrhaging our wealth to the foreign oil producers and to
the Asian countries that manufacture our products.

Our economy has been desperately weakened by the mortgage crisis on top of the crises I have mentioned above.
It has further unraveled what was already a vulnerable economy. Foreign financial interests are fast losing faith
in the vaunted US economy and have more confidence in the economies of Europe and Asia. That is reflected
in the exchanges rates.

[RB TexLa]

10. It doesn't need to be strengthen, a equalization of world currencies

has been overdue for a long time. It is a good thing and leads to a more interconnected world economy.

[zorahopkins]

12. Impeach Bush/Cheney

Getting rid of the current corrupt gang of incompetant thugs would be a great start.

They are enriching themselves at OUR expense!

[ben_meyers]

13. Your question might very well be why

not how. Some economists think that the dollar has been artificially strong for years. Many countries manipulate their currency to remain low as a competitive edge against our currency.

One reason that much of our manufacturing has gone over seas is the relative strength of our currency. in the long run who stands to gain from a weak dollar policy, importers or exporters?

If it's merely a "pride" thing then we need to get over that.

[JoDog]

19. It's not a pride thing for me

I have no idea how I am going to deal with the effects for inflation. I am driving as little as possible now, and am looking for ways to lower my living expenses, but I don't know if it will be enough--short of starvation.

[Blackhatjack]

14. The Paul Volker Solution to inflation was to let the prime rate rise to 13.5% which...

... absolutely killed off the housing market, drove companies out of business, played total havoc with businesses and their employees --but it drove inflation down under 3%, and with strict monetary control over printing 'new money' it provided a base to build on in strengthening the dollar.

It was absolutely brutal as I recall.

If we were to see a repeat of that Rx this time, Congress would have to act because existing credit card debt might carry interest rates of 30-45%. The housing values might dip below 50% of today's value as inventory piles up from foreclosures and reset mortgages.

We are in a tight spot and there are no easy answers. But first, you end the war in Iraq and plug that black hole we are filling with $12bil per month right now.

[JoDog]

20. Thank you

for the historical perspective. I doubt Congress will be able act to rein in the credit card industry until there is a Dem in the Oval Office.

[ThomWV]

21. ... resulted in the ouster of Jimmy Carter. Don't forget that little side effect

Even though the economic problems went straight back to Nixon.

[Winterblues]

15. A sane foreign policy for starters

And Credibility. Right now America has neither..

[Tindalos]

17. Let me try an analogy

A friend asks to borrow $20. You know he is having a hard time lately, so you have no problem giving it to him. The next day he says he needs another $20 because the other money is already gone. You hand it over, because you trust him. This goes on for a while. He asks you again. You're getting pretty annoyed by now because you can't see him making any effort to get his act together (get a job, reduce his debts, improve his life) but he convinces you to give him another chance. This time, you watch as he walks over to the window and throws the money out into the street. He then comes straight back and asks to borrow another $20. What would you do?


Not a perfect analogy, but this is how America is behaving. Money is borrowed and most of it is being spent on projects that even most Americans don't support (ie the wars). Meanwhile, important projects that would actually improve the US economy are neglected (infrastructure, education, health, social programs, job creation, etc). Until the money is actually used for something constructive, I don't think people will want to buy US dollars or invest in the US.


To reverse the slide, Americans need to invest in themselves. Make the country a place Americans can prosper in and then others will want to be part of it.

[guitar man]

18. stop printing money

tax the billionaires like the rest of us and start producing something besides rich executives....that would be a start anyway.