Quote:
Originally posted by Seb From Holland
Importing goods from America will be cheaper for Europeans if the Euro > Dollar.
Suppose I bought 100 chairs in America for $100 each. I'd pay a total of $10,000. At the current exchange rate that would be a total of ?8,626. Suppose the dollar weakens even more and the rate will be ?1=$1.20. I'd pay a total of ?8,333 instead of my original ?8,626 for my chairs. Now how could this be bad for me eh?
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You are missing the big picture here. We (no us people) are selling more to the US than buying from them. A lower $ is bad for us. For the US people a lower dollar is ok for two reasons.
The US has a big debt in dollars and a lower dollar wil make it easier for the US to pay it back. And the prices for US products will be cheaper within and outside the US when compared to non US products. This will help the US economy and bring more jobs to american people.
There will be a huge problem for the US when the dollar falls too fast becouse foreign investors will loze confidense and sell thier investmenst and then the dollar will drop even faster. A controlled devaluation of the dollar will help the US economy tho.
(edit: yea i know my english is crap...)