Monday, 14 April 2008

Hollowed-Out Economy

Despite the continually trippy optimism of most financial 'heads', there are still a few guy's shout from the edges

What was even more curious about the G-7 meeting was the lack of outcry from our [the U.S.] trading partners about the weak dollar.

There was no reference to any country’s intervening in the currency markets to stabilize the fluctuations, however, and no reference to whether the dollar’s recent slide against the euro had been too large, a trend that has worried many in Europe because it has made their exports more expensive and imports cheaper.

That’s because the Europeans and Asians are not worried about a flood of cheap American manufactured goods competing with their local producers. We have managed to so hollow-out our industrial plant in the last 30 years that they have little to fear. And as oil is priced in dollars, they have suffered far less in the recent price rises.