"If trade deficits are sufficiently large and
unsustainable, economists believe that they will be associated with
a weakening dollar at some future date."
Posted by pthoreson on 11th of Nov 2009 at 04:58 pm
OK, that of course makes sense. But, how do you explain the fact
that the US trade deficit has been shrinking over the past year
while the dollar has been falling?
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The link and the qoute
For those still confused about how OIL could push the dollar around
Posted by macnsc on 11th of Nov 2009 at 04:04 pm
The link and the qoute below are from your Friendly San Franciso FED
http://www.frbsf.org/education/activities/drecon/1999/9910.html
"If trade deficits are sufficiently large and unsustainable, economists believe that they will be associated with a weakening dollar at some future date."
http://en.wikipedia.org/wiki/Balance_of_trade
OK, that of course makes
Posted by pthoreson on 11th of Nov 2009 at 04:58 pm
OK, that of course makes sense. But, how do you explain the fact that the US trade deficit has been shrinking over the past year while the dollar has been falling?