The Falling Dollar

I'm not sure if this will become a weekly thing, but might as well try it out...

Basically want I'm going to do is flip though the Economist and let you all know what's up. Let's give big ups to that.

On the cover story this week is about the falling American dollar... interesting actually. The US economy isn't nearly as strong as everyone seems/seemed to believe it was. The housing bubble is going to hurt our economy more than we ever thought combine that with a falling dollar, and unsustainable consumer spending. In fact, on the topic of encouraging people to save... I don't understand why the government has been encouraging everyone to spend, spend, spend. I understand that part of it is American culture (boo consumerism) but it also has lead to this 'fake' economy that, as you can see, is coming down to Earth. People are spending and borrowing today at the expensive of the future, to the point where the government is going to have to bail everyone out in twenty years time anyway. Negative saving rates are never a good thing, yet the Bush administration has done nothing to try and change the average Americans habits in the past few years (hey look, the average US consumer has a low discount rate!)

Then again can we blame Bush for this? I mean he is busy effing around in Iraq* right now. (I'm pretty sure someone will write a book about Bush and Iraq called "The Nightmare that Wouldn't End").

But the US is in the position that the worlds currency is the dollar. People still don't trust the Euro (as any history buff/major can tell you, it's probably smart thinking). But a falling dollar isn't good for all those countries that hold dollars. Everything out there that can be read still says it's unlikely that these countries will dump the dollar tomorrow, all that will happen is that they'll start buying more Euros and Pounds. While this isn't the greatest news ever, it isn't doom either.

But back to the economy, of course the government can take a few steps to get things under control (rolling back tax cuts, cut defense spending, and encourage people to save more). We love to give Europe crap about having a 'stagnant' economy, but the fact is they're in a much better position that we are. We've been too short sighted for too long about our economy.

In other words, I feel for who ever gets elected in 2008.

*[Speaking of Iraq, when does the first movie about the Iraq experience get made? We've all seen/heard about the Vietnam films (Apocalypse Now, Full Metal Jacket, Platoon, etc); you figure those will all be remade but with Iraq as the subject.

Yet at the same time, the White House/Pentagon/Defense Department has done a 'wonderful' job at keeping everything under wraps. The media coverage of Iraq is all distant, it isn't broadcast into our homes every night like Vietnam was eventually. There is no Dan Rather on the front lines with this war. The caskets are brought home at night with no camera taping the planes touching ground. Newspaper reports all seem to be second hand accounts. This of course is all by design... what a shame.

And finally, no one says anything about this, but remember about two years ago when Lebanon forced Syria to withdraw troops and suddenly it looked like this crazyNeo -Con idea of forcing democracy down peoples throats might actually work? Well all that work, effort, and US backing has gone for naught apparently. That's what happens when you back Israel when they bomb the shit out of a country. I'm with everyone else who believe that the fastest way to peace is to deal with Israel and Palestine. The sooner the better. And the first step in solving that bullshit is to tell both sides that they've both wrong. Then work from there.]