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Junkie
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Originally Posted by host
Opinions, alansmithee, or do you have sources to post to substantiate your assertions in your last post ? I disagree with much of what you posted.
I submit that compared to the U.S., countries that use the Euro as their
currency have experienced only a small fraction of the increased expense of
oil imports, when compared to oil prices and currency values four years ago.
As you can see, if the numbers below are accurate, U.S. currency has already collapsed. It can be argued that U.S. equity market indexes (Dow 30, Nasdaq 2000, S&P 500) only appear to be "up" when observed by people who live in the U.S........ Equity indexes, just like barrels of crude oil , have been "re-priced" to reflect the collapse of the U.S. dollar value. When viewed in Euros, the values of U.S. equity indexes have dropped in half since the 2000 presidential election.
alansmithee, I can see the consistancy in the points you tried to make in your post, with what I perceive to be your political philosophy and sympathies. I see a U.S. administration that continues to passively observe a currency collapse that was signifigantly aggravated during it's tenure. I see no effective policy to encourage energy efficiency or to discourage domestic consumption. Monetary policy seems to consist of escalating federal borrowing and unrestrained creation of new consumer and corporate credit.
Please stop posting opinion with no references that can be fact checked.
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I find your tone very condecending. You are not half as demanding on those who post things you agree with. You do not want facts, you want opinions that mesh with your own. How has the US currency "collapsed"? Where is the rampant inflation that usually accompanys such a collapse? So here's some sources for you to dismiss because they don't agree with what you believe to be the truth, along with the comment that I made that was supported by them:
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Originally Posted by myself
Actually, the lowering of the dollar isn't as big a problem for the US as it is for the rest of the world, at least as far as trade is concerned. It makes US products cheaper in comparison to the rest of the world's, which other countries have problems with. This can also be seen in China, which has been accused of artificially lowering their currency's value to stimulate trade.
And the rising price of oil has hurt the EU's economy more than it has America's, because oil prices are based on the dollar. OPEC needed to raise prices to compensate for the devaluing of the dollar
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Pricing oil on the sliding dollar
A strong dollar helped them in stabilizing fluctuations in their financial wealth and had covered the exchange rate risk. But since January' 02 as it started weakening against key currencies, hurting the interest of the oil producers, mainly GCC countries that have pegged their currencies to dollar.
Dollar depreciation has proven a hidden tax on their revenues as their purchasing power has reduced significantly. For their imports from Europe alone they have to pay 52 per cent more than what they paid in 2001. Other major imports to these countries are from Japan that is also proving expensive for them...
The long-term growth prospects of Europe are not as bright as US, while EU is also facing other political problems and switching from dollar to euro may result in a rather more volatile currency markets...
Given these scenarios, if the private investors retreat from dollar, as the data shows that foreign capital flow from private investor is now edging downward, then international governments will most likely to intervene to bail out any crisis by purchasing dollar as this would also be equally important for their own economies and the currency market would be driven more on political grounds than on economic fundamentals.
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Strong Euro, high oil prices hurting German morale, survey shows
Surging oil prices and the strength of the euro, currently at an all-time high around 1.32 dollars, are currently weighing on business morale in Germany, the eurozone's biggest economy, a new poll showed on Thursday.
And with confidence also fading fast in other eurozone countries, such as Belgium and Italy, the pressure is likely to increase on the European Central Bank to step in and prevent the stronger euro from choking off recovery altogether, analysts said.
The widely watched business climate index calculated each month by Munich-based think-tank fell to 94.1 points -- its lowest level in 14 months -- in November.
The barometer had been treading water at around 95.3 points in the preceding three months.
The fall in the November reading was much steeper than analysts had been expecting -- consensus forecasts had foreseen a fall of just 0.5 point.
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http://www.europarl.eu.int/comparl/e...wyplosz_en.pdf
Much as the strong dollar of the late 1990s came at a propitious time for the US, today’s weak
dollar is good for the US economy. For the Eurozone, it is a mixed blessing, softening the oil
shock but weakening an already modest economic recovery.
The ECB finds itself in an uncomfortable position. Limiting the inflationary impact of the oil
shock calls for tightening up monetary policy. Limiting its contractionary impact calls for
loosening monetary policy. The strong euro limits the first impact and, provided second round
oil shock effects are contained, as seems to be the case, the ECB should stay put at this stage.
In addition, the ECB cannot do much to prevent a strong euro. Foreign exchange
interventions are largely ineffective. It could lower the interest rate, but this would require a
large reduction, which is not desirable at this stage.
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Originally Posted by myself
The reason I believe that reducing reliance on oil isn't higher priority is because there's no need yet. There are still vast oil reserves, many untapped. From a business perspective it's more expensive trying to develop new energy technologies than relying on oil
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Fossil Fuel Reserves World crude oil reserves are estimated to be more than 1012 barrels, of which the 11 OPEC Member Countries hold more than 75 per cent. OPEC's Members currently produce around 28 million barrels of oil per day. This is around 40 per cent of the world total output, which stands at about 75 million barrels per day. It is estimated that as world economic growth continues, crude oil demand will also rise to 90 million barrels/day in 2010 and 103 million barrels/day by 2020.
Oil is a limited resource, so we will eventually run out. Oil producers claim that this will not happen for many years to come, while others claim that this will happen within the next 20 years. Some people have been saying that there is only 20 years' supply of oil since the early 1970's. OPEC claims that it's oil reserves are sufficient to last another 80 years at the current rate of production, while non-OPEC oil producers' reserves might last less than 20 years. The worldwide demand for oil is rising and OPEC is expected to be an increasingly important source of that oil. It is further claimed by OPEC that if we manage our resources well, use the oil efficiently and develop new fields, then our oil reserves should last for many more generations to come.
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I think those were what you were disagreeing with mainly. I don't have the time (or ability) to teach ECON 101 to explain the differences between private finances and national finances. If you feel there is no difference, fine. And ill even concede that debt reduction should be larger if it makes you feel better.
I don't understand your need to constantly challenge opposing views that people here put forth. Are your beliefs so fragile that they can only find validation through internet "facts"? Or do you just not believe that anyone who disagrees with you can possibly have any knowledge at all? When I originally posted, what I put down was things I found to be true based upon my study in college and what I have seen on various business shows, and business articles in newspapers and magazines.
Why do you bother posting on the political board? You obviously have nothing but contempt for those you disagree with, so you aren't trying to examine other viewpoints. And your personal views are obviously backed by hours of hard internet research, so you don't need validation for your own views. Is it just to antagonize people who you disagree with? Do you have some insane need to be constantly "right"?
Please quit being a condecending ass.
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Originally Posted by chickentribs
Yeah, that would be super if we didn't import much more than we export. Alan, do you really think through your answers or do you just figure supporting Bush on everything is the way to go? Seriously.
The falling dollar value has become a favorite excuse for manufacturers who are closing down operations here in the U.S. and moving to other countries for cheaper labor and raw goods. It can be considered instant inflation, smothers trade, and forces interest rates up dramatically. It is a much bigger problem for us than the rest of the world.
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What does relative imports and exports have to with our goods being cheaper overseas? Above I have shown where our falling currency is as much, if not more of a problem for the EU.
And nobody said anything about supporting Bush. I find his economic policy fairly appaling. He might be the first president who has tried to make less (by lowering taxes) and spend more. What I don't agree with is the "sky is falling" mentality of many who do oppose Bush. I think the economy is strong in spite of Bush, not because of him.
Last edited by alansmithee; 02-26-2005 at 03:02 PM..
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