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Strategies & Market Trends : Mish's Global Economic Trend Analysis
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To: mishedlo who wrote (83369)8/18/2008 11:36:05 AM
From: The Vet  Read Replies (1) of 116555
 
Thanks for that explanation Mish.

I see the logic but it seems to ignore the fact that a higher dollar is detrimental for exports and the earnings of the multi-nationals. So in effect what you gain on the swings (the lower oil price) you lose on the roundabouts (export earnings). Obviously the oil price drop is more immediate but over the mid term, export earnings must suffer.

In the longer term the higher dollar simply reduces the incentive to produce at home and makes increasing imports more attractive; surely this can't be good for the US long term.
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