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U.S. Dollar Hits All-Time Low Vs. Euro @$1.33.35
Forbes ^ | 11.30.2004 | Associated Press

Posted on 11/30/2004 4:21:37 PM PST by M. Espinola

The dollar hit a new all-time low against the euro, which rose to $1.3335 on Tuesday as new figures showed that U.S. economic growth in the third quarter was stronger than previously estimated.

In late New York trading, the euro eased back to $1.3280, below its intraday high but still above Monday's late rate of $1.3273.

The dollar's weakness has been fueled by concern over the U.S. trade and budget deficits, and analysts say markets are paying only limited attention to other economic data against that background.

The dollar hit its low against the euro, whose previous record of $1.3329 was set Friday, shortly after European Central Bank President Jean-Claude Trichet renewed his assertion that the euro's rapid rise against the U.S. currency is "unwelcome."

Despite Trichet's attempt to talk the euro down, the dollar ended mixed against rivals on Tuesday, falling against the euro, British pound and Swiss franc, but strengthening slightly against the Japanese yen and Canadian dollar. The pound was quoted at $1.9107 from $1.8940 late Monday, while the dollar bought 103.03 yen, up from 102.82; 1.1392 Swiss francs, down from 1.1422; and 1.1879 Canadian dollars, up from 1.1838.

(Excerpt) Read more at forbes.com ...


TOPICS: Business/Economy; Foreign Affairs; News/Current Events
KEYWORDS: currency; euro; forex; usdollar
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To: bayourod
It was a Connecticut lender of all places. I found it on an internet search and refinanced about 15 months ago.
21 posted on 11/30/2004 5:02:31 PM PST by Dog Gone
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To: Dog Gone

But if we have to import certain necessities like oil --- how does a weak dollar help us? I know we can still import most of the durables because China is still tied to the dollar.


22 posted on 11/30/2004 5:08:24 PM PST by FITZ
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To: Retief
In contrast, Dell and HP computers are as cheap and ever, and will be selling like hotcakes everywhere.

Why wouldn't they just buy Chinese made electronics which are quite a bit cheaper than USA made?

23 posted on 11/30/2004 5:10:45 PM PST by FITZ
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To: FITZ
But if we have to import certain necessities like oil --- how does a weak dollar help us?

It helps the 5% of our economy that exports. It screws the other 95%.

24 posted on 11/30/2004 5:14:22 PM PST by Moonman62 (Federal Creed: If it moves tax it. If it keeps moving regulate it. If it stops moving subsidize it.)
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To: FITZ
Because it makes our goods much cheaper abroad, and building up manufacturing is a good thing.

Look at it this way, Americans feel it primarily in oil prices which still don't approach inflation-adjusted highs. Europe is screaming bloody murder about the dollar. Our tourists aren't going there. Their tourists are flocking to this country. We're rebuilding our country with their economic blood. What's not to like about that?

25 posted on 11/30/2004 5:17:44 PM PST by Dog Gone
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To: Retief

Glad I bought my M5 three years ago.


26 posted on 11/30/2004 5:21:38 PM PST by Cobra64 (Babes should wear Bullet Bras - www.BulletBras.net)
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To: Dog Gone

Well the free traders told me that letting go of manufacturing was a good thing --- we would somehow benefit if foreign goods were very cheap so we could buy them. Now the weak-dollarers are telling me the opposite --- that foreign goods should be expensive and we should want manufacturing. We should want expensive goods and expensive oil and other imports --- who is right?


27 posted on 11/30/2004 5:23:29 PM PST by FITZ
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To: FITZ
I buy a lot of cork from Portugal it has gone up 62% in a year.
28 posted on 11/30/2004 5:25:20 PM PST by rodguy911 ( President Reagan---all the rest.)
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To: M. Espinola

Plot that Euro chart back to the Euro's introduction, and you'll see we're right back where it started.

Meanwhile, this is great news for U.S. exporters, after two decades of getting the NAFTA shaft-a.


29 posted on 11/30/2004 5:25:49 PM PST by RightOnTheLeftCoast (You're it)
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To: Dog Gone
How did you ever get 3.75% the lowest it ever hit in S. Fla was around 4.5%, you stole that money.
30 posted on 11/30/2004 5:27:43 PM PST by rodguy911 ( President Reagan---all the rest.)
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To: RightOnTheLeftCoast

Meanwhile, this is great news for U.S. exporters, after two decades of getting the NAFTA shaft-a

I import machines from Europe. This makes it tough.


31 posted on 11/30/2004 5:28:02 PM PST by cornfedcowboy
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To: M. Espinola
Now they're posting to four decimals...
32 posted on 11/30/2004 5:30:47 PM PST by the invisib1e hand (if a man lives long enough, he gets to see the same thing over and over.)
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To: Solamente
Correct me if I'm wrong, but in the last 10-15 years the dollar would seasonally dip to 1.35-1.40 against the British Pound, then go up to 1.80+? That it dipped 2 cents does not seem such a big deal!?

This is a dip against the Euro, not the British Pound.

The British Pound is strong against the Euro. A few months ago the Euro and the dollar had parity practically.

33 posted on 11/30/2004 5:31:13 PM PST by Happygal (liberalism - a narrow tribal outlook largely founded on class prejudice)
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To: FITZ
It's not so much that we want expensive foreign imports as we want cheap American exports. Increasing demand for our products is obviously a good thing for our economy.

And foreign imports haven't really gotten that much more expensive. China's currency is pegged to ours, so there's been no change in the cost of their exports to us. Europeans have decreased their profit margins on their exports to the US to try to remain competitive, but it's gotten to the point where no more cutting can help.

This is almost certainly a temporary phenomenon. As the American economy heats up, we'll raise interest rates and the dollar will strengthen. And a robust American economy lifts the rest of the world with it. So they're just going to have to endure some temporary pain in order to make that happen.

The one country that gets a free ride out of this is China, which is why we are trying to get them to unpeg the yuan.

34 posted on 11/30/2004 5:33:28 PM PST by Dog Gone
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To: RightOnTheLeftCoast
Meanwhile, this is great news for U.S. exporters, after two decades of getting the NAFTA shaft-a.

If we don't have to pay too much for raw materials --- and it will help only whatever exporters we have left --- I just hope it's not the same people who applauded NAFTA that are applauding the weak dollar it's led to --- they would have to contradict themselves.

35 posted on 11/30/2004 5:36:28 PM PST by FITZ
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To: rodguy911
How did you ever get 3.75% the lowest it ever hit in S. Fla was around 4.5%, you stole that money.

I dunno. It was significantly lower to refinance to a 10-year loan than any loan of a longer term, so I jumped on it. My monthly payment dropped and my term shortened by about 11 years.

Any moron could see the wisdom in that.

36 posted on 11/30/2004 5:37:57 PM PST by Dog Gone
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To: traumer

You don't really understand this, do you?

The dollar is going down vis-a-vis the euro primarily. The decline against other currencies is not nearly as severe. The reason it is dropping like a rock against the euro is that the EU has a restrictive monetary policy that is killing their economy. They don't buy, we do. Because we are buying more of everything, we are buying more imports. They are not. The result is that we have a trade deficit, and the dollar goes down.

But who does it hurt? Primarily the EU. The EU cannot sell its goods in America without increasing the price or reducing their margin--and it's because the dollars they are selling their goods for are worth less to them. On the other hand, we can sell our goods in Europe for the same price and make more money because the euros we are receiving in payment are worth more.

Of course, it is true that we've got to pay more for imports--mainly oil. But not as much as we'd have to pay if the government restricted imports, which is the other alternative.


37 posted on 11/30/2004 5:42:43 PM PST by Brilliant
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To: Dog Gone
China's currency is pegged to ours, so there's been no change in the cost of their exports to us.

But that seems like the problem to me --- Chinese products are still far cheaper --- they don't have the tax burden to the USA government like American made products do. We'll still be importing from Mexico and China --- and what if the Europeans turn to those cheaper countries to buy and still don't buy from us?

38 posted on 11/30/2004 5:42:52 PM PST by FITZ
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To: conservativecorner
"I still believe the watch word at the Fed is deflation even when they talk inflation."

I also believe that deflation is their major concern.

I think Greenspan will try to get interest rates up to 6 to 7% as quickly as possible.

This will help to slow inflation, while getting the lending rate up high enough that deflation becomes less of a concern.

Also, the higher and the quicker the rates go up, the more "wiggle room" he leaves himself for the trademark "soft landing".
39 posted on 11/30/2004 5:49:47 PM PST by Dalite (If PRO is the opposite of CON, What is the opposite of PROgress? Go Figure....)
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To: FITZ
They might, if those countries produce the things they want, which they still don't in large quantities. The problem for them is more on the export side of the equation. If the world's largest consumer, the USA, quits buying stuff from Europe because it's too expensive, who are they going to sell it to, Rwanda?

The truth is that economic times in Europe are FAR worse today than they are here today. Check out their unemployment rates. Look at their deficits in comparison to GDP.

They are hurting.

They just need to hurt a little more, partly to encourage political and fiscal changes to their policies, and partly to bring the might American economic engine up to full force once again.

40 posted on 11/30/2004 5:53:49 PM PST by Dog Gone
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