A very good discussion over at the Economist about why political (and water cooler) discussions of the USD are so often just wrong.
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A very good discussion over at the Economist about why political (and water cooler) discussions of the USD are so often just wrong.
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2 responses to “Understanding the Dollar”
Prof – while I agree that not many people understand the foundations of money or who exactly controls its supply, it’s quite unfair to dismiss the arguments against quantitative easing based on such a misstatement by a former governor.
the plain fact is that currencies around the world have all devalued at considerable rates vs commodities. we can argue about whether that is fear induced or induced by fears of further easing. note that such extreme moves in currencies commodities and equities have moved considerably since Bernanke’s QE2 announcement near Labor day.
the author also seems to think that weak currency is a cure for all that ails the world. however, history suggests that stable, not necessarily weak or strong, currencies are the most viable.the rate of intervention is atypical and we can argue whether whether it is justified or not, but there are problems that should not be dismissed so quickly based on a scarecrow argument.
http://www.fame.org/HTM/Edwin%20Vieira%20Speech%20to%20the%20Rotary%20Club%20of%20NY%203-25-03.htm