There's no hiding from the impact of the falling value of the U.S. Dollar, which is likely to get worse before it gets better. Not surprisingly, most of us are more focused on day-to-day concerns, including sticker shock when we fill up the gas tank or buy a gallon of milk.
There's a growing awareness that the economy is in trouble, and guidance from political leaders ranges from denial to misdirection.
It's encouraging that even presidential candidate John McCain has progressed from his comment last December ("economics is not something I've understood as well as I should...") to at least publicly expressing concern about the impact of the economy on Americans.
It didn't help that McCain economic advisor and former senator Phil Gramm (R-Tex.) described the state of our economy as "mental recession" last week, and went on to complain that we've "become a nation of whiners." Needless to say, McCain scrambled to distance himself from Gramm's suggestion that this is just a figment of our imagination, which was difficult, since Gramm is McCain's national campaign co-chairman.
Gramm's credibility was already in question, since he co-sponsored the bill that deregulated the commodities markets (Commodity Futures Modernization Act of 2000), and included the so-called "Enron loophole." The debate rages on, as Congress tries to pin down the extent to which speculators are responsible for the high price of oil.
There's another major contributor; the falling value of the U.S. dollar, now at its lowest level since the United States abandoned the gold standard in 1971. After strengthening during the Clinton era, the U.S. Dollar Index has been on a steady decline and lost nearly half its value since 2001:
There's a growing awareness that the economy is in trouble, and guidance from political leaders ranges from denial to misdirection.
It's encouraging that even presidential candidate John McCain has progressed from his comment last December ("economics is not something I've understood as well as I should...") to at least publicly expressing concern about the impact of the economy on Americans.
It didn't help that McCain economic advisor and former senator Phil Gramm (R-Tex.) described the state of our economy as "mental recession" last week, and went on to complain that we've "become a nation of whiners." Needless to say, McCain scrambled to distance himself from Gramm's suggestion that this is just a figment of our imagination, which was difficult, since Gramm is McCain's national campaign co-chairman.
Gramm's credibility was already in question, since he co-sponsored the bill that deregulated the commodities markets (Commodity Futures Modernization Act of 2000), and included the so-called "Enron loophole." The debate rages on, as Congress tries to pin down the extent to which speculators are responsible for the high price of oil.
There's another major contributor; the falling value of the U.S. dollar, now at its lowest level since the United States abandoned the gold standard in 1971. After strengthening during the Clinton era, the U.S. Dollar Index has been on a steady decline and lost nearly half its value since 2001:
Is it really a surprise when the price of products traded in international markets doubles when the value of our currency has been cut in half?
This isn't just about oil, or even the real state bubble. It's about a soaring national debt, the balance of trade deficit, rising inflation, and a weak economy. It's also about the failed Bush economic policies (including the Bush tax cuts), which McCain has yet to reject.
And it's not a figment of our imagination.
This isn't just about oil, or even the real state bubble. It's about a soaring national debt, the balance of trade deficit, rising inflation, and a weak economy. It's also about the failed Bush economic policies (including the Bush tax cuts), which McCain has yet to reject.
And it's not a figment of our imagination.
0 comments:
Post a Comment