A Quote by Martin Feldstein
If the Federal Reserve pursues a strong dollar at home while the dollar becomes more competitive in global markets, we can achieve both price stability and a more balanced path of economic growth.
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The good news is that a competitive dollar in the global market and a strong dollar at home are compatible in both the long run and during the transition to a more competitive dollar.
My single biggest financial concern is the loss of the dollar as the reserve currency. I can't imagine anything more disastrous to our country. . .you're already seeing things in the markets that are suggesting that confidence in the dollar is waning. . .I think you could see a 25% reduction in the standard of living in this country if the U.S. dollar was no longer the world's reserve currency. That's how valuable it is.
In short, both experience and economic theory imply that the US could now t to a more competitive dollar without experiencing either increased inflation or decreased economic growth.
The Federal Reserve's objectives of maximum employment and price stability do not, by themselves, ensure a strong pace of economic growth or an improvement in living standards. The most important factor determining living standards is productivity growth, defined as increases in how much can be produced in an hour of work.
The dollar represents a one dollar debt to the Federal Reserve System. The Federal Reserve Banks create money out of thin air to buy Government Bonds from the U.S. Treasury...and has created out of nothing a ... debt which the American people are obliged to pay with interest.
The claim made by Team Obama that every dollar in stimulus translates into a dollar-and-a-half in growth is economic fiction. The costs of stimulus reduce future growth. No country has ever spent itself to prosperity. The price of stimulus has to be paid sometime.
Weaker currencies abroad mean a strong dollar, and a stronger dollar, together with a weak global environment, is a drag on the U.S. economy. So it's important, as it affects overall levels of production and employment in the U.S. There are many domestic industries doing well in the United States, notwithstanding a strong dollar.
As the dollar's exchange value declines, so will the value of dollar-denominated financial instruments, regardless of how many bonds the Federal Reserve purchases.
Even if the dollar does decline during the coming months, the delays in the response of exports and imports to the more competitive dollar will mean that the increase in aggregate demand from this source may not happen for a year or more.
After all, an overvalued dollar gives us the ability to buy foreign goods at lower prices. And the existing volume of exports brings more yen and euros than they would if the dollar were more competitive.
Back in 1960, the paper dollar and the silver dollar both were the same value. They circulated next to each other. Today? The paper dollar has lost 95% of its value, while the silver dollar is worth $34, and produced a 2-3 times rise in real value. Since we left the gold standard in 1971, both gold and silver have become superior inflation hedges.
I am concerned about the erraticness of the dollar. The dollar is up, the dollar is down. We print a lot of dollars. The dollar gets devalued. That is really the concern. If people think the gold price up and down is a reflection of something wrong with gold, no - I say it is something wrong with the dollar.
Over time, there's a very close correlation between what happens to the dollar and what happens to the price of oil. When the dollar gets week, the price of oil, which, as you know, and other commodities are denominated in dollars, they go up. We saw it in the '70s, when the dollar was savagely weakened.
You need in the long run for stability, for economic growth, for jobs, as well as for financial stability, global economic institutions that make sure that growth to be sustained has to be shared, and are built on the principle that the prosperity of this world is indivisible.
The financial markets are rigged by the big banks, the Federal Reserve, and the Treasury in the interests of the profits of the few big banks and the dollar's exchange value, which is the basis of U.S. power.
No one has yet convinced me a dollar stranded overseas is better than a dollar brought back home here to America for any reasons. So, if a company needs it, whether it's to do research, buy another business in America, grow jobs or try to become more financially strong, that is good for the United States.
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