Econo-Girl first started this blog as a response to CNN Money's horrible financial and economic coverage. Honestly, what passes for business reporting in the U.S. is just embarrassing.
No announcement is made without a positive candy-cane spin to it. For example, the news that the dollar is going down is couched with the "but that means exports will go up." Of course exports will go up. They won't go up enough to cover the amount we import, however. That would take sacrifice and discipline, and we all know how far that would go.
The real upswing about a lower dollar value is that it will kick up inflation here at home. Since we import a lot of stuff, and the exchange rate puts the dollar as buying less, less can be bought with the dollar. So the price to get a foreign good will go up.
There are some that gamely point out that now Americans will buy more domestically-made products. Sure. They will. But nowhere in the U.S. are clothes made as cheap as Asia, even with the lower dollar value making the prices rise.
So the practical upswing is: run to Walmart now to buy clothing, before the prices inevitably rise.
6 comments:
Exports will go up? WHAT EXPORTS???!?! What is still made in America to export? Other than more jobs that is! Exporting those does not really help a whole lot, unless you are an executive in a large company.
People will buy more domestic goods? WHAT DOMESTIC GOODS?!?!? Hell, even my Axe Shower Gel is made in Canada. The only thing I still buy on a regular basis that is made in America is Samuel Adams Boston Lager and Sierra Nevada Pale Ale.
As good as beer is, I do not think it can save the economy.
OH YEA! I almost forgot. The stuff I put in the cat box for the cats to poop in is also made in America. But I do not think clay can float the economy either.
We dug our hole. We choose short term profits over long term stability. So now we will just have to lie in the hole we dug and hope it does not rain.
But you probably already know this.
Isn't this suposed to be good if you're in debt ?
Iggy - Come now, we still export something, don't we? Hmmm, I'll get back to you on that.
Fuzz - Yes, this could be good news if you are in debt, if you can maintain your payments with rising interest rates. Econo-Girl has long advised getting loans with fixed rates.
What we export is raw material and manufacturing jobs.
On a bunch of products I see "made in ______ from USA components". Like my Axe Shower Gel. The "components are made here then "exported" to Canada, where it is all mixed up, packaged, then sent back to the USA.
Low value stuff out, higher value stuff in.
what about returning to the gold standard?wouldn't that be the right thing to do?that would cut off the all u can print theory...
Well, Medico, that's an interesting idea, but don't you think that the global economy has expanded beyond tying it to a commodity like gold? And remember, the value of gold can go up and down too.
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