How badly will the US $ Fall, will the US enter a recession ? Even Canada is ahead, Australias not far behind? - subprime mortgage canada
Thus, the U.S. dollar has fallen, or more, to the extent that other countries have increased at a comparable level. Soon AUD $ is equal to the sum of USD, currently around 90.5 U.S. cents. That the U.S. is now in a recession? Is hurting Iraq and the subprime crisis is doing?
Subprime Mortgage Canada How Badly Will The US $ Fall, Will The US Enter A Recession ? Even Canada Is Ahead, Australias Not Far Behind?
2 comments:
People are frightened by the falling dollar, but there is almost no possibility that the weak dollar will mean a recession. There is little correlation between the dollar and a recession, especially since the weak dollar is not on inflation.
In fact, the opposite is true: If the dollar is weaker, it becomes cheaper for foreign countries to buy American products. This stimulates the growth of exports. In addition, the central bank can take some measures to avoid a recession, if necessary, starting with lower interest rates.
Foreign exchange transactions are not a "race", so that it is impossible for a coin is in front or behind another thought. It is exactly what the currencies are traded on the open market. When the dollar gets cheaper, you begin to see foreign banks buying dollars because they know the final value will rise. Then it becomes a self-fulfilling prophecy because the increased demand leads to rising prices.
The only time the weak dollar is really bad, if, as I do, is make a tripto Europe and get hammered on the exchange rate. In a macroeconomic sense, but the weak dollar is not a threat to all.
The devaluation of the dollar is the result of an imbalance between supply and demand for the dollar. You can read, because the buyers want less than the dollar, given the low interest rates is atttract buyer and the lack of interest in U.S. investments. Because there are areas with the highest growth in developing countries and foreign investors higher returns on capital flows in that direction.
The United States is traditionally a safe haven for investment and capital flows, probably appear again, but only saturated when the development of foreign markets and the growth has slowed.
Then the Almighty dollar is once again against their peers.
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