In the 80’s and 90’s, the Regan, Bush I and Clinton administrations pursued a strong dollar policy. The result was high economic growth, job creation and good wage growth. The Bush II administration and the 3rd World style regime of Barack Hussein Obama Have abandoned the strong dollar policy. In the case of the Bush administration, they wanted to increase American exports. Obama’s reasoning is to devalue our currency so as to make the debt cheaper to finance. Federal Reserve Chairman Ben Bernanke is also contributing to a weak dollar policy. By printing money and monetizing the debt through debt buy back, the value of the dollar has sunk. This has created inflation and raised the prices of basic items. The result is that Americans’ living standards and purchasing powers are declining.
(Reuters) – For years, Treasury secretaries parroted a line that the U.S. was committed to a strong dollar policy. But as the greenback slides close to all-time lows, President Barack Obama’s administration has been noticeably quiet.
Treasury Secretary Tim Geithner last used “strong dollar” language in November, and a glance through his speeches and news databases shows he has had almost nothing to say on the matter since.
Meanwhile, record low interest rates, the Federal Reserve’s bond buying program, staggering budget deficits and the White House’s export-driven jobs policy all have contributed to the dollar’s decline.
All this has a growing number of investors and currency experts thinking Washington is passively accepting a gradual decline in the currency, hoping it helps engineer a vigorous enough recovery to get a battered economy in order.
Many Latin American countries tried this in the 70’s and 80’s. They would monetize their debt and print money with the aim of making the debt cheaper. It backfired and lead to a lost decade of economic growth in that region. Now Obama and Bernanke are implementing that same policy here. The results so far are the same. Our living standards are declining. Did they really think 3rd World style economics would work? We need a strong dollar policy that will increase the living and purchasing power of Americans.
Tags: 3rd World Economics, Strong Dollar
