Appreciation of dollar.
Dec 21, 2011 | 9:04 am
#31
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as i said, when introduced in 1999, the euro was pegged at about $1.00 us. and allowed to float free. after a short run to about $1.10per, the € dropped as low as $0.85 in '02.
i owned a business that purchased all raw materials in europe. about 3 years ago, i closed the door, as profit was impossible with the expensive euro.
as an aside, somewhere in the 80's(i think) the british pound almost reached parity with the us dollar. pound was under $1.05us.
i owned a business that purchased all raw materials in europe. about 3 years ago, i closed the door, as profit was impossible with the expensive euro.
as an aside, somewhere in the 80's(i think) the british pound almost reached parity with the us dollar. pound was under $1.05us.
Dec 21, 2011 | 9:17 am
#32
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I normally don't travel out of the US much, but with a trip to Rome coming up in May/June, I am hoping this trend keeps going. I have been checking every few days and dont' want things to turn around just yet, if at all.
Dec 21, 2011 | 10:22 am
#33
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Dec 21, 2011 | 10:52 am
#34
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I don't know about that wish. If the Euro goes crashing, Italy might not be as fun a place to visit.
Dec 21, 2011 | 11:28 am
#35
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Well, some people would argue that gold is an independent scale, and the US dollar isn't doing too well measured against it:
http://goldprice.org/gold-price-hist...ear_gold_price
Although obviously one man's "independent" is another man's "speculative investment bubble"...
http://goldprice.org/gold-price-hist...ear_gold_price
Although obviously one man's "independent" is another man's "speculative investment bubble"...
Dec 21, 2011 | 1:37 pm
#36
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I understand what you are saying but 'pegged' is the wrong word as that suggests that it was in some way controlled by the U.S. Dollar in the way that the two African francs are pegged to the Euro. Their exchange rate to the Euro is always the same, although, like the Euro, they float against other currencies. I think it might be better to say that when the Euro was initially constructed, its value was close to the dollar, perhaps by intent (although I think it was working off the value of the earlier ECU). It was the individual pre-Euro currencies which were pegged to the Euro while it was still a virtual currency, before they started issuing notes and coins.
Euro was created at par with US$. We can say that Euro was convertible at an approximate exchange rate of 1 Euro for 1 US$. You are absolutely right that individual Eurozone currencies were pegged to the Euro at the time of their entry.
Dec 21, 2011 | 1:47 pm
#37
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Dec 21, 2011 | 2:01 pm
#38
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Dec 21, 2011 | 4:36 pm
#40
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You might want to go back to period after World War I, 1923. The exchange rate was 4.2trillion Marks to the US$. Not sure how much a trillion Marks bought you.
Dec 21, 2011 | 5:21 pm
#41
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When I look at it, I always think of that Dr Evil laugh--one hundred trillion dollars !
http://en.wikipedia.org/wiki/File:Zimbabwe_$100_trillion_2009_Obverse.jpg
Dec 21, 2011 | 5:59 pm
#43
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That's debatable. The US economy was stronger at the beginning of the Reagan days... until the Reagonomics kicked in. 
The weaker favors European exports (because European products are now cheaper on the US market). Conversely, US products are now more expensive for Europeans. In this context, normally I'd say that EU wins (they get to sell more, therefore produce more, therefore have more people employed), but the fact is that the US economy being weaker, there is less demand for EU (or any) products.
The weaker favors European exports (because European products are now cheaper on the US market). Conversely, US products are now more expensive for Europeans. In this context, normally I'd say that EU wins (they get to sell more, therefore produce more, therefore have more people employed), but the fact is that the US economy being weaker, there is less demand for EU (or any) products.