I'm not anxious to see our dollar at $0.25
>>Notice however, that China's currency hasn't risen.<<
The reason for the Yuan not rising is China has it locked in place. There has beed talk the past few months about letting it float.
>>China, for instance, is hoarding $500 Billion in U.S. Dollars. India has another $88 Billion. Japan has even more. Europe, more Dollars still.<<
These are the main buyers of the Treaury auctions. Holding the US the debt keeps us alive and their economy moving upwards. Beneficial to both of us.
>> That extra value of the Dollar enables Americans to purchase more foreign goods than a free market would normally allow.<<
That atificially promoted value of the Dollar enables Americans to purchase more foreign goods than a free market would normally allow.
You can't see it at that level. A U.S. Dollar is *forever* locked in at $1.00 for Americans, never $0.25.
It's only to *foreigners* that the Dollar's value fluctuates, and even then it only fluctuates for remuneration back to your foreign nation...your intra-U.S. trade still gets full value.
High U.S. consumer purchasing power is key to the continued success of manufacturing economies like China. Our economies are symbiotic; we cannot lose purchasing power without adversely affecting China et al.
Dear Child, there has been more than talk; this whole Dollar drop is designed to break that Yuan-Dollar peg.
It is by propping up the U.S. Dollar with that currency peg that the Chinese are able to subsidize their exports to the U.S.
We'll kill that currency peg by dropping the Dollar back to its fair market value, and with that change the U.S. economy will further boom upwards.