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To: ARCADIA
"So far the decrease in the dollar's has done nothing to boost exports. Wouldn't we have seen a better current account by now? If the lower value was going to do something for us we wouls have started seeing it a year ago."

You'll only see it if you know where to look: at Europe. The lower Dollar is absolutely killing France and Germany's exports to the U.S. France's wine sales alone are down more than 30%.

But until the Yuan-Dollar peg is broken (which will happen this year), the trade deficit with China won't be impacted simply because technically, the Dollar hasn't fallen against the Yuan yet...and China's exports to the U.S. account for a full 1%, possibly a bit more, of the 9% of our GDP that we import each year.

Likewise, we've got to get the Indian rupee, Thai Bhat, and Japanese Yen back to a fair value versus their current devalued position versus the Dollar in order to see trade gap improvements there.

Now, as for our exports, overall they are actually up...but so too are our imports (for the moment). Break the Yuan-Dollar peg and that trade gap will come more back into line.

439 posted on 03/02/2005 12:41:39 AM PST by Southack (Media Bias means that Castro won't be punished for Cuban war crimes against Black Angolans in Africa)
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To: Southack
Break the Yuan-Dollar peg and that trade gap will come more back into line.

The fortune 500 guys haven't exactly been storming the shores to build 10,000 new manufacturing plants within our borders. Those who are in the best position to do so are not betting on the US economy.
441 posted on 03/02/2005 12:52:20 AM PST by ARCADIA (Abuse of power comes as no surprise)
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