[Southack]

"What exactly would a weaker dollar/yuan exchange rate do for the US? Chinese goods would be slightly more expensive (still cheaper than US goods) so US firms would buy slightly less from China and slightly more from Cambodia, Vietnam, Taiwan, and South Korea. Big deal."

It is indeed a big deal, especially if the Dollar falls against the currencies of Cambodia, Vietnam, Taiwan, and South Korea, too.

If you import too much, then your currency must drop to make importing goods more painful. This has the impact of making domestic goods more attractive.

It's a big deal, but few people can grasp the concept.

[DonaldC]

This is an area I don't understand very well, but with a corporate climate that does not want to produce anything in the states and a government that cannot exercise any form of fiscal responsibility, we are bound to be in a world of hurt sooner or later.