Wanna know why your dollar's declining? - Page 2 - The Finance Forums: Financial planning, debt help, loans, mortgages, retirement and 401k, investment, and general finance discussion forums

GarySpicuzza · #11 (**permalink**) 03-31-2008, 11:59 AM

Nice post Ed_B! You have taken dead aim!

Especially about the printing of money and purchasing power.

Quote:

In 1870, you could buy a Colt .45 pistol for a $20 US gold piece. Today, you still can.

Exactly!

One concept I don't think is ever layed out adequately enough is the amount of work a person had to do in 1870 to earn $20 to buy that Colt .45 pistol is the same amount of work they'd do today except the pistol today costs $427.

This reminds of when the Gubment always wants to raise the minimum wage for political votes. Go ahead, raise the minimum wage to $100 dollars per hour. It doesn't matter economically or mathematically every thing else will go up right along with the increased cost of labor and the hamburger flipper will be in no better financial position at $100 dollars per hour as he was at $7.00 dollars per hour.

My 2 cents which costs 43 cents today!

rxis · #12 (**permalink**) 04-01-2008, 06:06 AM

[quote=GarySpicuzza;7502]

This reminds of when the Gubment always wants to raise the minimum wage for political votes. Go ahead, raise the minimum wage to $100 dollars per hour. It doesn't matter economically or mathematically every thing else will go up right along with the increased cost of labor and the hamburger flipper will be in no better financial position at $100 dollars per hour as he was at $7.00 dollars per hour.
/quote]

The minimum wage discussion just brings up a whole bunch of topics in itself. I think it hits up the small business owners to fund social welfare which in turns allows big business to eat up the small business competition or gain further control over the small businesses.

I want to know why the media doesn't have more stories front and center about the dollar's strength in relation to the the price of oil.

Robert · #13 (**permalink**) 04-01-2008, 03:25 PM

Quote:

Originally Posted by Ed_B

How can the dollar free-fall be stopped when so many new dollars are being printed all the time and interest rates have been slashed? It is the falling rates and excessive dollar printing that cheapen the buck and there is no sign anywhere that I can see this changing. As our rates fall, money (which is incredibly mobile these days) simply moves elsewhere to earn higher interest rates.

Although a gold standard currency is not a panacea, it DID have one redeeming feature: no one in government could wave a pen and create more gold! You either had it or you did not. There was no "creative financing", derivitives, or other fiat money hocus-pocus schemes. In 1870, you could buy a Colt .45 pistol for a $20 US gold piece. Today, you still can. Inflation? Not really. Just the difference between REAL and fiat money being revealed.

Sir, You could not be more correct............Great answer. Regards, Robert

tella.star · #14 (**permalink**) 04-10-2008, 02:05 PM

there are alot of factors why dollar is declining..
some of it are, political instability, deficit, bad economic strategy and so on..

AllThingsPersonalFinance · #15 (**permalink**) 04-10-2008, 07:31 PM

The dollar's declining due to several neighborhood kids who get together and cause trouble at the bus stop. They are the mortgage industry implosion, rising national deficit, rising trade imbalance, and Federal Reserve rate cuts.

When the real estate and lending industries stabilize, when we stop financing US acitivities through foreign investments, when we export more than we import, when we stop cutting lending interest rates, when wage increases outpace the rate of inflation, when bigger investors put their money in the US stock markets rather than hedging with commodities, then, maybe, our dollar will begin to level out and increase its exchange rate.

Essentially, that is why gas is $3.40 a gallon.

But, generally, our dollar is declining because we spend more than we take in. The dollars that we print to cover our debts are just not worth as much.

rxis · #16 (**permalink**) 04-12-2008, 04:17 AM

We are screwed. Get your bug out ready.