Not sure of all the macro impact of a falling dollar, but I'm reasonably sure that this is a trend that will not stop anytime soon. I think we will see growing strength in the Euro for years to come.
I've read that a 30% drop in dollar value over the next two years is the best we can hope for. 30% means $4+ gas and lot's of inflation.
This will kill the Europeans,imports will be cheaper and exports will raise wiping out profits.
It usually takes about two years for the true effects of exchange rate changes to filter through the 25 EU economies.
Even now the French are calling for a return to the Franc and the EU commission is considering utilizing Article 111-2 of the Maastricht Treaty giving EU finance ministers the power to shape the exchange rate.
The commission invoking the "nuclear option" would basically shut down the European Central Bank.The effects on the Franco-German "canoe club" would be interesting to watch.
Meanwhile we will still be buying 99c hamburgers and enjoying a 5-6% mortgage rate.