The euro went up again today in relation to the dollar. When the euro was first floated it was about $0.75 and a joke. Now, with the euro at $1.60, the dollar is becoming the joke.
About $58.00 of the $118.00 price of a barrel of oil is due to the weak dollar.
Bush and Bernake think you don’t understand this stuff well enough to figure out what’s going on.
Remember that the Fed with its airs of great authority and vast knowledge are allowing the economy to slowly go down the toilet.
We shouldn’t be heading into recession!
Their policies are what’s causing this!
Please, please read this quote from this economics book and understand it:
“What determines the value of money? That is, what determines the general range of prices? The value of money obviously is high when the general range of prices is low; for a given amount of money will then buy much of other things.
Its value obviously is low when the general range of prices is high; for a given amount of money will then buy little of other things. What, now, causes its value to be high or low, prices to be low or high?
The first step toward answering this question is to understand the relation between the quantity of money and its value. The fundamental relation is a very simple one. Double the quantity of money, and, other things being equal, prices will be twice as high as before, and the value of money one-half. Halve the quantity of money, and, other things being equal, prices will be one-half what they were before, and the value of money will double.
That an increase in quantity tends to lower value, is a proposition holding good of all commodities. The special proposition concerning money is that its value tends to vary precisely in proportion to its quantity. This constant relation does not hold good of any other commodity. Double the quantity of wheat, and its value will probably fall to much less than half of what it was before. Double the quantity of sugar, and its value will probably fall by no means to one-half. For both wheat and sugar, the outcome will depend on the elasticity of demand. But in the case of money, there is no question as to elasticity of demand and no such difficulty in prediction. The value of money, under the simplest conditions, is exactly inverse to its quantity.
Quote from Principles of Economics
by F. W. Tausswig, Ph.D., Litt.D., LL.D.
Macmillian Co. New York