Heard today - 'If the FED Cuts the interest rate value of the dollar will plunge'

Hmm, could be, but what happens when the dollar is worth nothing?

And many of us don't own stocks, so that part really isn't good news.

Well as we've been there before, maybe selling apples out of a box on the street.

But really, a few things that are going on. The Yen which was carrying the Sub-Prime loan debt is now finally after a few months un-winding that carry trade, but the Euro is picking up that slack, not the US. And those that buy oil in Euros aren't really seeing much of a rise in the price of oil in Euros at all.

Therefore other countries money is still worth money as they haven't been hit yet by the low interest rates, However, Japan has been hit in the past and it has them taken twenty years in the recent past to work out of their problems.

In the US the problems with the banks and the writing down of their assets that is going on is clearing up the mess. However, the Fed, even tho the banks are writing down their assets and re-pricing the risk for loans (Higher interest rates as well as double checking the folks that want to barrow the money just to see and to make sure that they will be able to pay the money back) may still lower the interest rates at the end of October, just to appear to ease the money tied up in the so called credit crunch.

However, as the banks are currently dealing with the problem, the Fed in my opinion really doesn't need to lower rates, for that action wont do anything for the economy for a long time, like around six months, and therefore, is not really a solution at all, as the banks are working through the issues fairly well in my opinion.

For what is the dollar worth anyway, other than the paper it's written on. What we're dealing with here are impressions and illusions and the confidence of the people in the world.

One should remember that Gold used to be worth $18 an once, now it's worth more paper dollars at $789 an once. Today the Dollar is worth 70 cents to one Euro, and five years ago the dollar used to be worth 1.18 cents to one Euro, that's around a 40 percent drop.

Those that don't own stock and those that do will be hit with higher prices for things that need transportation to deliver the goods to the store and those items that come from Farms, such as food.

Those item can't be called inflation because food and fuel and energy aren't used in the calculation for inflation.

He who has gets ever more because it is him that makes the rules ... him that has the power to enforce those rules ... the rich get richer and the poor get dead ...

However, Jerry those dollars that the rich have are worth a lot less now than before.

But the poor, are still the poor, and still eat beans, but I still love those beans also.

We are spending ourselves broke with this assanine war! Besides, 18 months ago before interest rates went up, the dollar was strong. Turn off the war machine,keep our money here, produce products here and the economy will improve.

There are several reasons the dollar is weaker, and the recent drop in interest rates isn't even the biggest one.

(1) International growth is faster than domestic growth.
(2) The credit crunch, which has lead to higher interest rate spreads and lower demand for U.S debts, and not just in subprime mortgages.
(3) Our large, persistant trade deficit (at 5.5% of GDP, even though it's significantly lower than the 7% it was a few years ago), meaning the world is awash in dollars.

The drop in the dollar isn't a bad thing, it just changes our economy. It increases inflation for imports and makes traveling overseas more expensive, but it is good for American buissness and helps reduce our trade deficit. If you're worried about domestic manufacturing, the falling dollar is quite good, because it makes it cheaper for foreign countries to invest in the U.S, makes our exports cheaper to other countries, and increase the prices of imports.

Am I the only one who finds it funny that often the same people who bitch about how the dollar is falling also want the Chinese to revalue the yuan and the japanese to revalue the yen?