Politics Unfiltered

[salvador]

(08-05-2014 05:56 PM)Decagon Wrote:  I would argue that the dollar has become weak by design, as a way to make exports cheaper and imports more expensive, among other issues.

You are totally right.

But even more than wanting competitive exports, the gov't wants a lower dollar because the entire system has been built on debt and the game is to keep paying back debt with cheaper dollars (both gov't and private). These debts have to get easier to repay over time so that we can both repay the debts and we can still have the capacity to borrow more and keep growing at any cost.

INFLATE OR DIE!!!!!!!!!!!!

As long as the gov't can grow the money supply at 15% a year while convincing the markets that the inflation rate is 2% a year it is going to do it.