Dec 6, 2006

Dollar at 14 Year Low Against the Pound

A further explanation of the effects that our trade deficit can have.
AFP article on illustrates the precarious position the dollar is in after 7 straight years of decline against the British Pound and nearly 2 years against the Euro. The Chinese government has only allowed for a revaluations since July of last year and those are tightly regulated. Even with their stringent efforts to keep products from China cheap too maximize exports, the dollar has fallen 5% against the Yuan.

China has become such a large part of our economy that any increase in pricing will first hurt the people that can afford it the least.