[AdamSelene235]

but in fact, a new economic theory holds that trade deficits are a conseqence of wealth.

Your new economic theory, for lack of a better term, is crap.

This is what happens when you run a prolonged trade deficit:

[aynrandfreak]

Very convenient charts. How about showing the period when we had increasing trade deficits while the dollar was strong and oil was dropping.

[Moonman62]

The dollar pretty much goes where our government wants it to go these days, and at least since 1985's Plaza Accord. Foreign exchange isn't an efficient market simply because it's dominated by a few large players, namely the governments of the largest economies. The US, as the largest economy by far, is so influential it usually doesn't even have to intervene in the market, but give a wink as to which way the dollar is to go. Of course, it helps to follow through with a coordinated monetary policy, which Greenspan has always done. That's been his secret all these years. He follows dollar policy, while shoveling manure disguised as some kind of mystical economic wisdom to anyone who wants to listen.