The US Dollar is On Track For Its Worst Year in Modern History (semafor.com)
- Reference: 0178277406
- News link: https://news.slashdot.org/story/25/07/04/0750244/the-us-dollar-is-on-track-for-its-worst-year-in-modern-history
- Source link: https://www.semafor.com/article/07/03/2025/the-us-dollar-is-on-track-for-its-worst-year-in-modern-history
> A weaker dollar could make US exports more competitive, boosting Trump's plan to rebalance US trade, but makes imports more expensive, adding to the sting of tariffs.
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> The question ahead is whether the dollar doesn't just lose its value, but its role at the center of the global financial system. So far, there are few alternatives. And efforts to de-dollarize -- central banks shifting into gold, China shoveling its currency into developing nations through swap lines -- haven't meaningfully shifted the picture.
[1] https://www.semafor.com/article/07/03/2025/the-us-dollar-is-on-track-for-its-worst-year-in-modern-history
Deficit spending causes inflation (Score:5, Interesting)
This inflation is the direct result of deficit spending by the government - every time monetary supply is expanded (i.e., printing money) the value of existing currency decreases. This way higher deficits result in higher inflationary pressures (i.e., things cost more, dollars exchange rate goes down). This is why many conservatives objected to the BBB, as it continued and expanded deficit spending.
Re:Deficit spending causes inflation (Score:4)
> This is why many conservatives objected to the BBB, as it continued and expanded deficit spending.
Which conservatives objected to the BBB, and didn't end up voting for it?
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Notably, Elon Musk, at great risk to his personal fortune.
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Musk doesn't get a vote so no he did not vote against it and despite all his whining now he only has to look in a mirror to see who is to blame for installing a greedy moron in the WH.
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I think he'll be fine. He could lose 99.9% overnight and still be better of than the rest of the country.
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Musk didn't actually mean it, he'll get richer either way.
Most notably Musk did not put his money on the line like he did to get Trump elected so frankly Musk bears far more responsibility for all this than he probably wants to admit.
Musk threw up an objection to cover his embarrassing exit from the admin and play kayfabe to his board members since he was at risk of losing control of Tesla. Musk can continue eating all the dicks and he will be remembered for his role here.
Re: Deficit spending causes inflation (Score:1)
Elon is a handy boggieman when you don't want to look inward.
Why Democrats are paying for ads supporting Republican primary candidates
[1]https://www.npr.org/2022/06/20... [npr.org]
Trump and the current maga legislator is there because of the Democrats advertising for them.I have no real expectation for them to be fiscally conservative.
I want to see a balanced budget and the dept to go down. Elon musk has never been a good person from what I know, but he is in the corner I prefer now.
[1] https://www.npr.org/2022/06/20/1106256047/why-democrats-are-paying-for-ads-supporting-republican-primary-candidates
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Why are we talking about House races in 2022, also did you read the article? They explain why, you just don't think it was a good strategy, I don't disagree. I don't expect you to read my posts but I am quite critical of how the DNC strategizes. That does not forgive 1 single fucking iota of what Trump, Republicans and Musk have brought to us.
> I want to see a balanced budget and the dept to go down.
Why and what does a "balanced budget" look like? Justify that statement. Also what dept are you even talking about? Do better trolling.
Re:Deficit spending causes inflation (Score:5, Insightful)
Elon Musk is not a conservative. Nor a liberal. He's whatever he needs to be at any given moment.
When federal money was raining on his brand new telsa factory he was all for left-leaning, social governement. And all conservatives hated him, and liberals loved him. But when said governements started annoying him about things like, you know, safety regulations, worker's conditions, etc, then he turned all anti-governement, pro-business, "I'm-going-to-move-everything-to-Texas" right-wing conservative. And sudenly, all conservatives started loving him and liberals started burning teslas.
Trump is the same. He was a card carrying democrat for more than four decades and a good friend of the Clintons... Until he decided to run for president, when he instantly switched to conservative for logistical reasons. And now conservatives think he's the second coming of Christ (literaly).
Musk and Trump are opportunistic sociopaths. They are whatever the fuck they need to be at any given time to court whatever part of the population they need to court in order to accomplish their goals.
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I hate to say this outloud, but my respect for Rand Paul went up a little bit.
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> I hate to say this outloud, but my respect for Rand Paul went up a little bit.
I, personally (no knock against anyone else for feeling differently), don't respect him anymore than I did before, but I do acknowledge when politicians that I don't hold in high regard (for lack of less family-friendly terms to use) actually do the right thing, because I do respect that in someone, even if I don't respect anything else they've done or represent otherwise.
For example, I still don't think Mike Pence is a particularly good person in general (he jumped onto the Trump train, and was a willing p
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I guess you are right. For a Doctor, Rand Paul does not seem to respect Science very much. I do like Pence as a person, however, you are right that he took a lot of french from Trump before finally standing up to him, he enabled Trump. Shame. So here we are.
On the soapbox for a moment (Score:1)
Yes! A couple of things. One nitpick, bank loans don't cause inflation even though they do increase the money supply, because they are paid back. All across the economy you have loans being taken and paid back simultaneously, so it evens out. It only does cause inflation when loans are forgiven, like the student loan forgivenness that Biden tried, or that 2008 housing crisis. If the $36t (is it $37t now?) was ever paid back, that money would disappear from the economy and the value of the dollar would go wa
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It is not as simple as "Deficit spending causes inflation". Deficit spending only leads to inflation if the demand for dollars outside the U.S. is less than the generated deficit. Since WWII there has been a high demand for dollars outside of the U.S. as it is the de-facto currency of world trade. Up until Trump's uneducated policies we have been able to trade our dollars for products produced outside the U.S. because the world wanted our dollars. Trump is not only reducing demand for dollars outside th
Re: Deficit spending causes inflation (Score:2)
How come the stock market outperforms inflation and keeps setting new record highs? How are you going to buy the S&P 500 if you don't hold dollars?
Lake Wobegon exchange rates (Score:3)
Calling for [1]stronger Chinese and Japanese currencies [reuters.com] is essentially calling for a weaker dollar. Unless we want all currencies to be "stronger than average".
[1] https://www.reuters.com/markets/currencies/trump-says-japan-china-cannot-keep-reducing-value-their-currencies-2025-03-03/
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Not sure about Japan, but China does manipulate its currency, devaluing Yuan in an indirect subsidy to Chinese exports. Doing so is against WTO rules.
No! (Score:5, Funny)
Why would Obama allow this to happen!
Re:No! (Score:4, Funny)
It must be the fault of some random trans person!
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Who was probably using Hunter Biden's laptop!
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Poor kids. You're in denial. You've got 4 more stages to go.
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I like Egypt! lol.
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Better of the two Funny comments, but the story is such a rich target...
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This kind of "tells me" that the USA is headed into a debt and inflation spiral. I hope not, however, all of the signs are in place.
Re: "Worst" is a judgement call (Score:2)
Remember when your attitude was prevalent in the 1980s but the US stock market is still insanely profitable?
Re:"Worst" is a judgement call (Score:4, Interesting)
You're right. But considering global trade and public perception, having a "weaker" currency nowadays directly means more expensive stuff.
I live in a country with a heavily devalued currency and while a good part of national industries greatly benefited of it by expanding its exports (which leads to a positive trade balance for the country), it isn't well seen by the majority of the population that end up having much less access to several products.
Also, the most benefitted industries are the primary ones (commodities), which have a lower demand for technology and less aggregated value. Industries that need to import machines, supplies and services get depressed and outdated by increasing, almost prohibitive costs.
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Can I move where you are?
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No, it isn't a judgement call. The summary and article are very clear: they are talking about the exchange rates USD vs the other major currencies. They are clearly postulating, and providing evidence for, a decline in purchasing power of the USD aginst the others. It isn't up to interpretation; it isn't up to your opinion; you don't get a say. It is hard, cold, truth.
Funny how that stings, isn't it.
Re: "Worst" is a judgement call (Score:2)
What if you buy US stocks with your dollars, and they go up more than the dollar declines?
Even USAs own rating agencies ... (Score:3)
... are having a hard time justifying their favorable ratings. With one the US has moved from AAA to AA a few years back and even that was seen as being nice and kind. I hope the US doesn't squander trust beyond the Trump era, lest you guys be sitting on a pile of money that the world has finally noticed not being worth the paper it's printed on.
It is my opinion that you could have a true revolution, a bottom-up redo of the US constitution and fixes for the most glaring broken parts of the US system up and running within months without even a single bullet fired. AFAICT from across the pond basically _everyone_ agrees that the current state of things has become untenable. You don't need to be a bunch of Trumpists storming the Capitol to see this.
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I see... people wearing masks taking citizens off of the streets, and detaining them indefinitely without a trial. I see, propaganda spread like wild fire. I see the POTUS getting his own military and police force. I see the US going through a difficult time period. I see MAGAs love their guns and this will not go well without a lot of blood being spilled.
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I don't think the problem is with the Constitution. Any Constitution is just a piece of paper, unless people collectively honor it. You could say it makes the Executive too strong, but this has happened gradually as we allowed it, or asked for it, since Congress has become crippled with partisan politics. For example the Constitution gives the power to set tariffs to Congress, not the President. Yet look where we are now.
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As Ben Franklin said, we have a Republic, if we can keep it. It is a belief system. There are so many examples from History about decent countries spiraling out of control, and yet, many can not understand and learn from this. As my dad said: "you can learn from being bit by a snake, or you can see someone else being bit and learn from that".
Re: Even USAs own rating agencies ... (Score:1)
I had a liberal friend saying there need to be a revolution. I honestly see a fair amount of violence from both sides looking for their own excuses. I'm in Japan and I have to do my paperwork to stay. Why is the US the exception case for immigration, and why does it warrant violence against ICE and officers.
It was going to be either Bernie or Trump in office to try to fix the grid lock in government. The Democrats chose Trump both literally and figuratively while wining like they didn't pay money to the D
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The USA was kind of founded on immigration. The only ones of us that were not immigrants were kind of killed or locked into small bits of uninhabitable land. This is the answer to: "Why is the US the exception case for immigration"? Bring us your ..... well you have to look up the engraving of the Statue of Liberty yourself.
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What kind of asshole tries to "both sides" the political violence in the United States? It's overwhelmingly coming from the far right. I bet you spend a lot of time comparing mountains to molehills.
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People who can't admit the party they voted for is fucking up. The real shocker is they're doing exactly what they promised and people are flabbergasted. I thought he would only deport criminals, not the guy doing prep work at my favorite restaurant!
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> It is my opinion that you could have a true revolution, a bottom-up redo of the US constitution and fixes for the most glaring broken parts of the US system up and running within months without even a single bullet fired. AFAICT from across the pond basically _everyone_ agrees that the current state of things has become untenable. You don't need to be a bunch of Trumpists storming the Capitol to see this.
It's being worked on. Clarence Thomas would fast track this [1]https://en.wikipedia.org/wiki/... [wikipedia.org]
[1] https://en.wikipedia.org/wiki/Three-fifths_Compromise
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Thomas is the poster child for MAGA corruption, in my humble opinion. Your fault for getting me off topic.
The US "dollar" worst in modern history? (Score:2)
How about the US, period?
shame (Score:2)
the lower USD, isn't preventing Americans from traveling abroad, but is is preventing them from identifiying as American and pretending to be from Canada, as show in the first few seconds of this youtube video: [1]https://www.youtube.com/watch?... [youtube.com]
[1] https://www.youtube.com/watch?v=ag2LVr1LHSs
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That's been a thing since Iraq in 2003.
It's always bad news with the dollar (Score:5, Interesting)
I live in Canada. Every time you hear news about the dollar, it's bad news, whether it goes up or down. If it goes up the news reporters go and interview exporters who complain that this hurts their business, and when it goes down the reporters interview importers who explain how this is going to make all the products we buy more expensive. It's honestly very tiring. I mostly just ignore stories like this.
If a currency is functioning normally (not being manipulated) then it works to automatically balance trade. If Americans start buying more and more from overseas, then supply and demand in the currency market will cause the dollar's value to go down, which makes American products and investments more attractive to everyone else. You just have to understand that the US buys a lot of cheap products from overseas, but mostly exports expensive high end products like aircraft parts and machinery. People around the world really like investing in US companies (and even T-bills) because the US market is large, profitable, and safe. Therefore the long term trend has been that Americans import a lot of cheap products in exchange for a lot of investment capital flowing into the US. This kept industry humming, but also had the effect of pushing up housing prices, as a lot of people invest in US real estate.
The dollar has traditionally been so high because the US was considered to be such a safe place to invest. Investors around the world wanted better returns, and foreign governments wanted a safe reserve currency, and for the most part the US government took advantage of this because it gave the US access to very cheap capital (borrowing) which allowed deficit spending, and it also gave the US enormous leverage over pretty much every other country in the world financially. For instance, the sanctions against Iran, North Korea, and Russia are based on the fact that the global system of trade is mostly based on the US dollar.
The US dollar is falling because even though Americans are still buying lots of stuff from overseas, there's a notable concern about the stability of the US as both a safe place to invest, and as a good investment return. Now I personally think there's still a potential for high return on investment if I were to invest in the US, but I do also have concerns about any money I have in US investments because you just don't know if the US government would do something drastic like confiscate foreign investment, etc. I don't consider it likely, but it's not something I would have worried about 10 years ago, but it's at least a remote possibility now.
I think the goal of the US is to bring more manufacturing back onshore. I think this is a reasonable goal. There are always winners and losers in any change. Bringing back manufacturing jobs tends to help the working class, as does limiting the supply of cheap labor by deporting lots of people. Note that while this is probably a net benefit to the working class, corporations won't like it. They prefer a strong US dollar which makes borrowing cheap and they prefer low wages too, so they're generally pro-immigration. But that's the story of the last few years... the working class has now gained political influence, not just in the US but across the western world, and the right-wing political parties have embraced them, which is a bit surprising because the right-wing parties have traditionally been the party of big business.
Big business now finds itself politically homeless, or certainly far less influential than they used to be. I suspect they're just hoping to ride this out. I'm not convinced this is a temporary situation. I believe that Trump has proven that the working class is now in play politically, and both parties will bend themselves towards catering to their interests. We even saw this in Canada with the liberal party running a guy who's very moderate, perhaps even right-of-center in some ways, and reduced immigration significantly even before the election earlier this year. I think this is just the ne
[1]Read the rest of this comment...
[1] https://news.slashdot.org/comments.pl?sid=23735242&cid=65496714
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tl;dr
The emperor's new clothes look great!
Trump Destroying Dollar's Global Sentiment (Score:2)
The dollar achieved its lofty position in world finance because the U.S. came out of WWII unscathed as the world's greatest industrial power and the entire world in debt to the U.S. Today the U.S. is in debt to world and the U.S. is no longer the world's largest industrial economy. The value the dollar has today is based on momentum and sentiment and Trump is destroying it's sentiment. The dollar has been losing almost 2% of its value a month during Trump's current tenure and is down 15% since the beginn
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"They believe this will bring back 1950's industrial power to the U.S.". Just wow. That seems like a complete disconnect from reality, in my humble opinion.
Time to resurrect the old meme... (Score:3)
And efforts to de-dollarize -- central banks shifting into gold, China shoveling its currency into developing nations through swap lines -- haven't meaningfully shifted the picture... YET .
Fixed that for you!
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Fundamentally, US dollar is backed not by gold but by carrier strike groups. Until someone else has an answer to that USD will continue being world reserve currency no matter what US Fed does for monetary policy.
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Carrier strike groups require a lot of stuff that must be bought with dollars.
At some point in time that isn't too far in the future, the stuff that the dollar buys will not be enough to support both carrier strike groups and the billionaire class.
We will see if the military "AI" can compensate the loss of maintenance due to the decline of dollar value.
I will not delve in minor detail like the relevance of the carrier strike groups or the lack of alliances, which the Trumpistan gladly destroyed.
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What does that even mean? Keep using the dollar or you'll get bombed (and warned early by the drunken defense sec?)
Re: Time to resurrect the old meme... (Score:2)
Well, yes. It's not coincidence that Qadaffi was trying to bring about a Pan-African currency or that Iraq was selling oil in non-US currencies.
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The dollar is backed by every price sign, wage, and contract. Its because its widely used, that it has backing. Everyone's salary is the US is in USD. All products are also. Imagine "retooling" this to some other currency? It would be difficult to boil down all the factors that determine price and recalculate it in another currency. Not just the difficulty in determining price, as difficulty could be easily overcome by some hard work, but that its tied to all the other items in the supply chain which are al
Re:Time to resurrect the old meme... (Score:5, Informative)
Just to add some insight:
> Trump, in a Truth Social post, said: “We require a commitment from these Countries that they will neither create a new BRICS Currency, nor back any other Currency to replace the mighty U.S. Dollar or, they will face 100% Tariffs, and should expect to say goodbye to selling into the wonderful U.S. Economy.”
[1]https://apnews.com/article/tru... [apnews.com]
[1] https://apnews.com/article/trump-dollar-dominance-brics-treasury-8572985f41754fe008b98f38180945c3
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100% MicroDollars is still almost nothing. Again, the tariffs mostly work against the US itself.
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> they will face 100% Tariffs , and should expect to say goodbye to selling into the wonderful
I wish he would get a bigger vocabulary.
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The way the Idiot King is pissing countries off, it might not be long before the whole world realigns its trade to leave the US mostly out in the cold. That would be a huge win for Putin, of course, so Trump would be fine with that.