It comes down to free markets seeking a semblance of parity in global purchasing power. As I've written here before, we American's can make $400 on a Saturday tending bar and know we can "exchange" that $400 for the labor and materials of 10 Chinese guy's manufacturing a plasma. We take it as gospel that an autoworker in Flint provides 20x the utility of an assemblyman in Tampico. It used to be American's worked 10 minutes for a gallon of gas while a Malaysian worked a day. Now perhaps we work half an hour for the same product while the Asian works two hours. Someday we'll be at parity. I'm no liberal but I am fair minded and there's a social-justice tenant saying all men are equal. This bring's us to Bernanke, Cheney and policy.
There are two distinct economic American's. One part of America benefit's from asset appreciation rather than labor and the other provide service in exchange for currency/essentials. In a capitalistic society the poor work for the rich. That's fine. That's how poor folk eat and with initiative they can try to be un poor. Hence to keep the chain afloat it's important to keep asset prices away from levels that could cause upheaval. The only people who really benefit from price shock are shorts and those seeking entrance into the asset class. Rest assured, the asset holders aren't looking out for the interest of those two groups. Is there a price to pay for risk avoidance? Of course and it manifests itself in the form of a cheaper currency.
A devalued dollar effects the asset holder very little. His assets will generally appreciate in cheap dollars so that they can maintain global parity in price. The America toiling for dollar wages suffers the most as it's they who are assetless and paying more for essentials. Just the same, they'd be far worse off being unemployed.
With the negative balance of trade and our number one export being debt how could anyone think that we'd maintain lordship over the third world? Because of our know how? Give me a friggin' break. Been to Compton? Besides those American's with know how-particuarly 6"11 power forwards- are rewarded very nicely. It is what it is.
There are two distinct economic American's. One part of America benefit's from asset appreciation rather than labor and the other provide service in exchange for currency/essentials. In a capitalistic society the poor work for the rich. That's fine. That's how poor folk eat and with initiative they can try to be un poor. Hence to keep the chain afloat it's important to keep asset prices away from levels that could cause upheaval. The only people who really benefit from price shock are shorts and those seeking entrance into the asset class. Rest assured, the asset holders aren't looking out for the interest of those two groups. Is there a price to pay for risk avoidance? Of course and it manifests itself in the form of a cheaper currency.
A devalued dollar effects the asset holder very little. His assets will generally appreciate in cheap dollars so that they can maintain global parity in price. The America toiling for dollar wages suffers the most as it's they who are assetless and paying more for essentials. Just the same, they'd be far worse off being unemployed.
With the negative balance of trade and our number one export being debt how could anyone think that we'd maintain lordship over the third world? Because of our know how? Give me a friggin' break. Been to Compton? Besides those American's with know how-particuarly 6"11 power forwards- are rewarded very nicely. It is what it is.
