Re: Partly true...


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Posted by MoparNorm on Friday, February 29, 2008 at 14:01:15 :

In Reply to: Re: Partly true... posted by D. Sherman on Thursday, February 28, 2008 at 23:13:19 :

You're overlooking a basics of economics, exchange rates have no effect on a nation unless that nation primarily imports.
If the oil is pegged to Euros @ 75 Euros a barrel, our price is $100 and we would peg our domestic oil at that price. As the dollar slides, our price to ourselves remains $100 USD but becomes 150 Euros, so imported oil costs more, domestic oil costs less.
The reason we are letting the dollar slide is to keep interest rates low to keep the sub prime crisis in check and make American exports cheaper on the world market.
It's working, US exports are up 30% and US manufacturing is coming back.




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