[elli1]

As the dollar drops, U.S. exports become more affordable and "should" begin to increase as U.S. goods are more competitively priced.

Cheap USD ought to mean increased tourism from abroad and, what about the stock market? I wonder how much of the bull market can be traced to (medium/ longterm) investment from overseas?

[ndt]

"Cheap USD ought to mean increased tourism from abroad and, what about the stock market?"

Well one problem there is that we have combined the attractions of a cheap dollar (to tourists) with increased visa bureaucracy. So much bureaucracy that business travel to the U.S. has dropped precipitously exactly when it should be increasing.

"I wonder how much of the bull market can be traced to (medium/ longterm) investment from overseas?"

Bull market I think little. If the stock market was being held up due to investor demand, the price earnings ratio would get our of whack as people would be paying more then a company was worth. In fact some sectors are historically affordable, not overpriced.

The ability to hold a stable dollar dollar while simultaneously maintaining a deficit in both trade and budget was subsidized by foreign purchase of our debt.

Thats fine as long as everyone wants your money. The world is changing and changing fast. The E.U. is a larger economy and has more money in circulation than the U.S. and is now accepted as being a competing standard to the U.S. dollar. At the same time, Latin America, China and India are all coming into their own.

Any intelligent investor, foreign governments included will choose to hold a diversified portfolio assuming one can be put together. We are seeing the U.S. lose it's position as the only game in town. That's not a bad thing, economic diversity is a good thing, you just don't want it to happen over night and our government needs to realize that business as usual is no longer a valid option. Never really was.