Posted on 09/28/2007 2:32:19 PM PDT by oblomov
SAN FRANCISCO (MarketWatch) -- The dollar dropped across the board Friday, marking the seventh straight trading session in which it's sunk to a record low against the euro, after tame core inflation data suggested that the Federal Reserve has room to further cut interest rates. The euro was at $1.4270, after rising as high as $1.4277 earlier, well above $1.4147 in late U.S. trading Thursday. The dollar was buying 114.73 yen, down from 115.65 yen Thursday.
The dollar's drop accelerated after William Poole, the president of the St. Louis Fed, said in a speech that the central bank stands ready to cut rates again to keep the economy on a moderate growth track in the face of the financial market turmoil.
"My guess is that the inherent resilience of the U.S. economy along with future policy actions, should they be desirable, will keep the economy on a track of moderate average growth and gradually declining inflation over the next few years," Poole said in New York City.
Data released by the Commerce Department early Friday showed core consumer price inflation, which excludes food and energy prices, fell 0.1% in August, bringing core inflation over the past year down to 1.8%, the lowest since early 2004. See Economic Report.
"The greenback is under pressure across the board on Friday, as tamer core inflation data combine with U.S. slowdown concerns to weigh the unit down," wrote analysts at Action Economics.
The dollar has been in a tailspin against most of its major rivals since the Fed's surprisingly large, 50-basis point interest rate cut on Sept. 18, in a move aimed at preventing the subprime mortgage market meltdown from dragging down the broader economy.
(Excerpt) Read more at marketwatch.com ...
It has little to do with inflation, and more to do with trade flows. I’ve gotta believe that the EU ministers are sweating now, though. They may have a harder time selling things in the US.
We gotta get it from somebody since all we got to export is jobs and dollars.
It’s not sentiment...it’s that the U.S. Dollar has been **VASTLY** overpriced since the end of WW2 in order to prop up the foreign economies collapsed by that war.
...at our expense.
Now the Dollar is gradually coming back down to reality. Still a ways to go, though (China, are you listening?!).
The sentiment is that the U.S. is going down the tubes. Its people do not save, over-consume, many are mired in risky loans in a crashing real estate market, and it has a government which spends like drunken sailors while throwing endless amounts at Iraq.
Actually tame inflation here and increasing inflation in Europe would correlate precisely with a lower dollar and a higher Euro. The relationship is direct and not inverse between values of denomination and inflation.
That is incorrect. If $1 buys a big mac here today. It buys 1 Euro buys a big mac in europe. In 5 years if $1 still buys a big mac and and takes 2 euros to buy a big mac, the Euros value is now worth half of what the dollar is.
Exactly. And with China pegging their currency to the Dollar - they have precious little choice considering the amount of Dollars they hold - the EU is facing incredible sales pressure from the US and China.
Figure that in the last 18 months, 60% of what the EU uses - which is the totals that come from the US and China - have increased by 30%. That is HUGE inflation in imports.
It’s only by their governments accelerating inflation and tossing billions into the kitty that they are still alive.
I think the devaluation of the Dollar - and, as a result, the Yuan - is completely purposeful and is aimed at breaking the Euro. Give it another 3-5 years at this exchange rate and it will break. Simply cannot keep up, given that EU exports are going to be way too pricey, and American and Chinese imports will finish off the last of their manufacturing AND service industries.
So countries will shed the Euro in hopes that their own currencies will stabilize a bit lower, to keep the last legs of their businesses still live so their own governments survive. It’s going to be an exodus from the Euro.
Buy low, sell high
Oh wait...
“after tame core inflation data suggested that the Federal Reserve has room to further cut interest rates.
“My guess is that the inherent resilience of the U.S. economy along with future policy actions, should they be desirable, will keep the economy on a track of moderate average growth and gradually declining inflation over the next few years,”
Well that is very good news. I hope he’s right. I’d like to see the US expand it’s manufacturing sector. And a cheap dollar sure helps.
No, that can’t be the case, at least if the purchasing power parity model of currency valuation holds.
Regardless of whether this is the case, either lower interest rates are bad for the dollar, or lower inflation is bad for the dollar, but both can’t be true as the article suggests.
I personally think someone with a lot of money is manipulating the $. There simply is no reason for the US Dollar to be worth 40% less than it was 4-5 years ago. Our debt as a % of GDP has gone down, our growth is stronger than Europes, our unemployment rate is lower, and our inflation is tamer. It simply doesn’t make sense. If it stays this low though, it should be a huge boon to our manufacturing sector and exports in general.
It sounds lie pre-revolutionary France.
If lower inflation is bad for a currency then Zimbabwean & Venezuealn curencies should be strong.
Seriously, the job of most financial reporting is to project optimism.
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U.S. Exports to World (Total)
|
End-Use Code | Value 2002 | Value 2003 | Value 2004 | Value 2005 | Value 2006 |
---|---|---|---|---|---|
(00000) Wheat | 3,771,920 | 4,002,455 | 5,191,779 | 4,416,027 | 4,277,103 |
(00010) Rice | 832,936 | 1,077,760 | 1,223,738 | 1,337,714 | 1,355,253 |
(00100) Soybeans | 5,806,179 | 8,047,048 | 6,894,715 | 6,626,555 | 7,275,892 |
(00110) Oilseeds, food oils | 1,317,380 | 1,419,363 | 1,273,706 | 1,190,935 | 1,317,680 |
(00200) Corn | 5,784,028 | 5,750,589 | 6,926,461 | 5,824,420 | 8,269,286 |
(00210) Sorghum, barley, oats | 674,758 | 677,489 | 611,091 | 628,355 | 685,877 |
(00220) Animal feeds, n.e.c. | 3,298,763 | 3,297,751 | 3,115,922 | 3,387,722 | 3,804,049 |
(00300) Meat, poultry, etc. | 7,002,732 | 7,873,236 | 5,671,895 | 7,206,280 | 7,862,701 |
(00310) Dairy products and eggs | 714,816 | 744,458 | 1,167,111 | 1,299,418 | 1,491,898 |
(00320) Fruits, frozen juices | 4,038,150 | 4,295,114 | 4,533,462 | 4,996,914 | 5,561,085 |
(00330) Vegetables | 2,900,539 | 2,965,801 | 3,189,490 | 3,509,842 | 3,846,197 |
(00340) Nuts | 1,657,332 | 1,891,211 | 2,365,554 | 3,043,642 | 3,227,156 |
(00350) Bakery products | 2,020,889 | 2,255,755 | 2,467,241 | 2,696,155 | 3,003,394 |
(00360) Other foods | 4,482,548 | 4,906,768 | 5,340,365 | 5,872,533 | 6,584,793 |
(00370) Wine and related products | 726,766 | 817,565 | 984,623 | 912,592 | 1,093,913 |
(01000) Fish and shellfish | 3,197,235 | 3,363,283 | 3,823,237 | 4,207,720 | 4,350,247 |
(01010) Alcoholic beverages, excluding wine | 627,135 | 681,029 | 777,286 | 821,174 | 958,040 |
(01020) Nonagricultural foods, etc. | 761,472 | 959,336 | 1,011,988 | 977,358 | 1,044,079 |
(10000) Cotton, raw | 2,066,878 | 3,388,982 | 4,279,556 | 3,933,122 | 4,514,984 |
(10100) Tobacco, unmanufactured | 1,058,963 | 1,025,809 | 1,041,246 | 983,722 | 1,133,905 |
(10120) Hides and skins | 1,751,470 | 1,793,603 | 1,757,782 | 1,787,883 | 2,054,917 |
(10130) Agric. industry-unmanufactured | 1,173,376 | 1,255,510 | 1,468,907 | 1,401,808 | 1,575,829 |
(10140) Agric. farming-unmanufactured | 1,544,415 | 1,731,381 | 1,610,260 | 1,833,043 | 1,849,933 |
(10150) Agriculture-manufactured, other | 1,617,726 | 1,377,403 | 1,510,523 | 1,651,371 | 1,734,142 |
(11010) Metallurgical grade coal | 1,024,080 | 1,014,289 | 1,760,238 | 2,385,524 | 2,559,063 |
(11020) Coal and fuels, other | 898,318 | 788,371 | 1,206,042 | 1,329,221 | 1,331,295 |
(11100) Crude oil | 87,556 | 128,282 | 308,194 | 551,652 | 567,008 |
(11110) Fuel oil | 2,583,998 | 3,117,433 | 4,353,770 | 6,932,607 | 12,070,290 |
(11120) Petroleum products, other | 6,978,589 | 8,633,021 | 11,583,088 | 14,104,621 | 17,347,478 |
(11130) Natural gas liquids | 687,884 | 814,265 | 836,838 | 1,075,494 | 1,625,140 |
(11200) Gas-natural | 995,442 | 1,399,765 | 2,125,663 | 3,109,833 | 2,243,303 |
(11300) Nuclear fuel materials | 1,510,512 | 1,570,651 | 1,631,283 | 1,619,190 | 1,827,438 |
(11400) Electric energy | 303,047 | 755,696 | 828,855 | 1,046,509 | 1,051,985 |
(12000) Steelmaking materials | 1,863,503 | 2,607,012 | 4,014,104 | 5,991,623 | 6,838,801 |
(12100) Iron and steel mill products | 3,219,083 | 4,176,506 | 5,208,393 | 6,917,987 | 7,283,742 |
(12110) Iron and steel products, other | 2,768,597 | 2,905,047 | 3,636,622 | 4,351,229 | 5,155,405 |
(12200) Aluminum and alumina | 2,947,824 | 3,032,119 | 3,992,337 | 5,191,121 | 7,292,147 |
(12210) Copper | 1,112,520 | 1,510,815 | 2,002,919 | 2,356,484 | 4,699,934 |
(12260) Nonmonetary gold | 3,356,634 | 4,790,354 | 4,449,217 | 5,548,806 | 8,755,920 |
(12270) Precious metals, other | 2,560,780 | 2,144,607 | 2,758,099 | 3,175,711 | 7,041,621 |
(12290) Nonferrous metals, other | 2,148,428 | 2,464,242 | 3,053,412 | 4,523,315 | 6,609,065 |
(12300) Finished metal shapes | 8,728,448 | 8,948,222 | 9,964,894 | 11,405,809 | 13,932,951 |
(12420) Pulpwood and woodpulp | 4,051,462 | 4,259,100 | 4,696,567 | 5,272,294 | 5,903,241 |
(12430) Newsprint | 8,160,275 | 8,554,129 | 9,274,785 | 9,862,581 | 10,556,635 |
(12500) Plastic materials | 14,104,243 | 15,407,108 | 21,656,550 | 24,793,298 | 27,873,376 |
(12510) Chemicals-fertilizers | 3,924,528 | 4,105,064 | 4,744,018 | 5,197,329 | 5,280,861 |
(12530) Chemicals-inorganic | 3,929,179 | 3,930,315 | 4,423,922 | 5,880,332 | 6,663,746 |
(12540) Chemicals-organic | 14,631,857 | 17,633,336 | 22,187,353 | 23,377,062 | 26,971,487 |
(12550) Chemicals-other | 13,238,295 | 14,443,025 | 15,609,108 | 16,721,139 | 18,521,381 |
(12600) Cotton fiber cloth | 2,728,651 | 2,788,335 | 3,264,766 | 3,232,897 | 3,132,042 |
(12620) Manmade cloth | 4,894,813 | 5,048,515 | 5,550,833 | 5,686,350 | 5,765,167 |
(12630) Hair, waste materials | 429,684 | 447,027 | 493,439 | 483,543 | 552,150 |
(12640) Finished textile supplies | 2,248,350 | 2,196,564 | 2,321,442 | 2,377,417 | 2,541,374 |
(12650) Leather and furs | 840,316 | 866,753 | 1,193,579 | 1,095,540 | 1,051,998 |
(12700) Synthetic rubber-primary | 1,675,484 | 1,852,549 | 2,218,021 | 2,694,877 | 3,185,546 |
(12720) Nonmetallic minerals | 416,415 | 427,349 | 488,635 | 488,854 | 605,994 |
(12750) Industrial rubber products | 2,190,650 | 2,199,254 | 2,452,514 | 2,585,845 | 2,923,854 |
(12760) Mineral supplies-manufactured | 3,093,482 | 3,307,186 | 3,670,944 | 3,751,497 | 4,502,639 |
(12765) Tapes, audio and visual | 1,203,833 | 1,346,509 | 1,620,300 | 2,014,146 | 1,795,704 |
(12770) Other industrial supplies | 14,477,266 | 15,049,554 | 13,757,853 | 14,793,038 | 16,363,223 |
(13100) Logs and lumber | 3,568,646 | 3,675,962 | 4,213,673 | 4,332,968 | 4,593,107 |
(13110) Wood supplies, manufactured | 875,807 | 911,252 | 1,028,197 | 1,074,196 | 1,220,776 |
(13200) Glass-plate, sheet, etc. | 977,598 | 979,685 | 1,088,950 | 1,141,029 | 1,278,636 |
(13210) Shingles, molding, wallboard | 1,891,071 | 1,961,770 | 2,284,145 | 2,637,272 | 3,016,416 |
(13220) Nontextile floor tiles | 297,270 | 300,613 | 337,797 | 377,329 | 414,304 |
(20000) Generators, accessories | 6,171,391 | 6,286,538 | 7,028,809 | 7,613,908 | 9,464,756 |
(20005) Electric apparatus | 21,373,353 | 21,158,082 | 24,231,365 | 25,674,197 | 29,748,335 |
(21000) Drilling & oilfield equipment | 6,562,205 | 6,066,973 | 6,869,681 | 8,153,668 | 10,778,601 |
(21010) Specialized mining | 384,423 | 419,075 | 544,473 | 634,938 | 838,010 |
(21030) Excavating machinery | 4,986,166 | 5,284,702 | 6,657,603 | 8,812,827 | 9,866,450 |
(21040) Nonfarm tractors and parts | 960,239 | 1,063,017 | 1,439,904 | 1,382,445 | 1,858,428 |
(21100) Industrial engines | 11,601,418 | 11,690,670 | 13,511,204 | 14,934,258 | 15,953,605 |
(21110) Food, tobacco machinery | 1,732,148 | 1,688,991 | 1,860,182 | 2,064,865 | 2,192,826 |
(21120) Metalworking machine tools | 5,174,725 | 5,252,726 | 7,075,695 | 7,663,288 | 9,490,359 |
(21130) Textile, sewing machines | 1,059,214 | 1,020,197 | 1,134,193 | 1,247,851 | 1,274,629 |
(21140) Wood, glass, plastic | 2,597,190 | 2,503,246 | 3,367,352 | 3,645,557 | 3,628,566 |
(21150) Pulp and paper machinery | 2,278,780 | 2,372,552 | 2,566,827 | 2,718,324 | 2,850,457 |
(21160) Measuring, testing, control instruments | 13,218,013 | 13,936,101 | 16,927,323 | 16,720,633 | 19,119,448 |
(21170) Materials handling equipment | 4,488,470 | 4,655,814 | 5,984,009 | 8,162,312 | 9,903,852 |
(21180) Industrial machines, other | 21,727,003 | 21,718,029 | 26,971,265 | 28,295,944 | 32,709,273 |
(21190) Photo, service industry machinery | 5,422,145 | 5,714,167 | 6,553,936 | 7,492,107 | 8,178,549 |
(21200) Agricultural machinery, equipment | 3,526,203 | 3,793,910 | 4,422,448 | 5,144,124 | 5,308,940 |
(21300) Computers | 9,190,115 | 8,664,470 | 9,198,120 | 10,206,187 | 11,444,607 |
(21301) Computer accessories | 29,362,295 | 31,260,248 | 33,607,204 | 35,330,167 | 36,087,221 |
(21320) Semiconductors | 42,234,579 | 46,137,440 | 48,050,388 | 47,221,556 | 52,383,482 |
(21400) Telecommunications equipment | 22,207,691 | 20,743,162 | 24,543,091 | 25,666,771 | 28,911,061 |
(21500) Business machines and equipment | 2,023,646 | 1,927,170 | 2,110,291 | 2,335,954 | 2,704,205 |
(21600) Laboratory testing instruments | 4,824,079 | 5,118,842 | 6,093,197 | 6,665,275 | 7,279,594 |
(21610) Medicinal equipment | 14,481,033 | 15,742,536 | 17,852,664 | 20,364,358 | 22,664,867 |
(22000) Civilian aircraft | 26,676,656 | 23,305,357 | 22,917,114 | 29,332,618 | 40,714,914 |
(22010) Parts-civilian aircraft | 12,222,736 | 12,134,464 | 13,217,079 | 15,305,904 | 17,373,828 |
(22020) Engines-civilian aircraft | 11,584,658 | 11,338,959 | 13,840,691 | 16,145,914 | 16,947,535 |
(22100) Railway transportation equipment | 1,245,275 | 1,641,902 | 1,856,082 | 2,345,207 | 2,938,227 |
(22200) Vessels, excluding scrap | 204,471 | 67,122 | 40,953 | 64,957 | 51,701 |
(22210) Commercial vessels, other | 179,292 | 138,968 | 207,814 | 230,358 | 222,269 |
(22220) Marine engines, parts | 758,992 | 793,606 | 740,348 | 976,964 | 1,127,802 |
(22300) Spacecraft, excluding military | 36,932 | 37,138 | 53,632 | 37,955 | 26,894 |
(30000) Passenger cars, new and used | 20,552,414 | 22,102,841 | 24,609,325 | 30,492,691 | 34,530,937 |
(30100) Trucks, buses and special purpose vehicles | 8,363,362 | 10,244,379 | 11,928,396 | 13,477,345 | 15,090,202 |
(30200) Engines and engine parts (carburetors, pistons, ri | 10,112,579 | 10,112,654 | 10,754,788 | 11,324,368 | 11,924,358 |
(30210) Bodies and chassis for passenger cars | 138,831 | 185,673 | 148,197 | 58,449 | 58,962 |
(30220) Automotive tires and tubes | 1,909,086 | 1,819,338 | 2,124,051 | 2,403,281 | 2,479,500 |
(30230) Other parts and accessories of vehicles | 37,866,139 | 36,220,655 | 39,727,480 | 40,916,620 | 43,088,027 |
(40000) Apparel, household goods - textile | 6,305,462 | 5,935,708 | 5,389,846 | 5,311,955 | 5,183,748 |
(40030) Apparel,household goods-nontextile | 1,307,645 | 1,349,863 | 1,433,964 | 1,672,191 | 1,835,403 |
(40050) Sports apparel and gear | 445,492 | 421,225 | 436,046 | 485,324 | 588,006 |
(40100) Pharmaceutical preparations | 17,347,840 | 20,529,484 | 25,431,506 | 27,618,757 | 30,789,492 |
(40110) Books, printed matter | 3,969,325 | 4,175,252 | 4,397,917 | 4,820,801 | 5,192,672 |
(40120) Toiletries and cosmetics | 4,139,641 | 4,580,874 | 5,260,323 | 5,975,099 | 6,754,315 |
(40130) Tobacco, manufactured | 1,962,035 | 1,881,706 | 1,599,295 | 1,340,630 | 1,362,642 |
(40140) Writing and art supplies | 4,609,284 | 4,695,044 | 5,062,591 | 5,623,401 | 5,827,807 |
(41000) Furniture, household goods, etc. | 2,122,958 | 2,415,749 | 2,723,936 | 2,885,663 | 3,204,067 |
(41010) Glassware, chinaware | 450,822 | 348,977 | 393,530 | 405,241 | 432,492 |
(41020) Cookware, cutlery, tools | 695,857 | 687,921 | 733,034 | 771,945 | 869,659 |
(41030) Household appliances | 4,536,883 | 4,830,195 | 5,224,404 | 6,050,859 | 6,650,584 |
(41040) Rugs | 693,290 | 693,005 | 789,475 | 906,070 | 1,003,387 |
(41050) Other household goods | 8,444,489 | 9,389,945 | 10,754,075 | 12,428,236 | 14,073,095 |
(41110) Pleasure boats and motors | 1,086,943 | 1,368,396 | 1,911,421 | 2,480,770 | 2,778,543 |
(41120) Toys/games/sporting goods | 5,459,446 | 5,692,490 | 6,316,574 | 7,564,206 | 9,027,618 |
(41140) Musical instruments | 1,032,717 | 862,781 | 1,056,377 | 1,058,999 | 1,067,154 |
(41200) TV's, VCR's, etc. | 3,955,119 | 3,382,301 | 3,602,070 | 3,639,449 | 3,872,073 |
(41210) Stereo equipment, etc. | 1,541,870 | 1,560,706 | 1,712,822 | 2,213,713 | 2,461,393 |
(41220) Records, tapes, and disks | 3,221,800 | 3,191,920 | 3,386,401 | 3,640,005 | 3,642,747 |
(41300) Numismatic coins | 56,008 | 63,051 | 54,118 | 67,805 | 154,448 |
(41310) Jewelry, etc | 2,968,325 | 3,049,472 | 3,867,696 | 4,727,493 | 6,143,415 |
(41320) Artwork, antiques, stamps, etc. | 2,901,776 | 3,036,051 | 3,877,752 | 4,778,136 | 5,953,003 |
(42000) Nursery stock, etc. | 269,747 | 289,308 | 313,536 | 341,782 | 387,790 |
(42100) Gem diamonds | 4,834,043 | 5,476,603 | 7,346,005 | 8,906,873 | 9,987,222 |
(50000) Military aircraft, complete | 1,672,201 | 2,159,009 | 2,360,999 | 2,417,217 | 4,464,598 |
(50010) Aircraft launching gear, parachutes, etc. | 89,950 | 116,027 | 214,592 | 305,808 | 344,791 |
(50020) Engines and turbines for military aircraft | 1,836,533 | 1,320,834 | 1,260,987 | 1,566,406 | 1,643,565 |
(50030) Military trucks, armored vehicles, etc. | 722,039 | 635,004 | 745,331 | 920,345 | 844,889 |
(50040) Military ships and boats | 2,060 | 1,000 | 0 | 0 | 5,170 |
(50050) Tanks, artillery, missiles, rockets, guns and ammu | 1,929,437 | 1,615,936 | 2,067,159 | 2,037,040 | 2,714,343 |
(50060) Military apparel and footwear | 812,385 | 844,928 | 506,395 | 668,594 | 693,123 |
(50070) Parts for military-type goods | 4,639,359 | 4,816,374 | 4,728,834 | 4,919,362 | 5,918,013 |
(60000) Minimum value shipments | 14,635,601 | 15,043,576 | 16,781,625 | 18,800,866 | 19,745,847 |
(60010) Miscellaneous domestic exports and special transac | 6,514,038 | 5,858,199 | 5,737,754 | 5,328,568 | 5,241,316 |
(60040) Undocumented exports to Canada | 0 | 0 | 0 | 0 | 3,250,666 |
TOTAL | 693,103,192 | 724,770,983 | 818,774,859 | 905,977,633 | 1,037,142,973 |
LOL!
Quick the sky is falling! LOL. Nice #s
Over $1 trillion in exports last year. Not bad considering we don’t make anything here anymore.
That’s a 49% increase in 4 years. That’s pretty darn impressive for exports. I expect this year should be solid as well. If oil wasn’t so high, we might even be close to running a trade surplus.
None of the links work.
Over $1 trillion in exports last year. Not bad considering we dont make anything here anymore.
I agree that we obviously do still make things for export and that exports have had increased significantly in nominal terms over the past four years. However, it's worth looking at exports and imports as a percent of GDP as shown in the following graph:
The actual numbers and sources are at http://home.att.net/~rdavis2/tradeall.html. As can be seen, as a percent of GDP, exports are still below their 1997 high. Imports, on the other hand, have increased significantly over that period. As a result, so has the trade deficit.
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