Dollar slides after US Fed plan

[dipsydoodle]

Source: BBC News

The dollar has fallen against all major currencies after the US Federal Reserve announced a plan to buy $1.2tn (£843bn) of debt to boost its economy.

The dollar fell by 2.9% against the euro and by 2.5% against the pound.

The US currency also declined against the yen, the Norwegian krone, the Australian dollar and Brazilian real.

The Fed's decision to buy debt means it is effectively creating new money, leading to concern from investors about the over-supply of dollars.

Read more: http://news.bbc.co.uk/1/hi/business/7952319.stm

[ayeshahaqqiqa]

1. I don't understand why they are doing this

Default on the debt, and give those dollars to the poorest in our land--they will immediately spend the money, which will increase demand for goods/services, which will help the economy.

[medeak]

2. made it back from Italy just in time n/t

[Sultana]

4. I am in England/Europe till June

God help me :( x(

[medeak]

7. good luck

was in UK 3 yrs ago and paid $17 US dollars for hamburger and Burger King....don't even get me started about Starbucks. ;-(

[Sultana]

10. Holy Shit

:wow:

Note to self, next time travel or stay in a country that has a weaker currency. ;)

I miss America and its inexpensive stuff :cry:

[medeak]

11. son went to school in UK for a year

and lived off cans of soup. Was sick all the time...don't let that happen to you!

[Sultana]

12. I cook my own meals from scratch (sometimes)

I just hate that I can't spend like I use to in the US on clothes and random things x(

Dammit, I rather not think about the exchange rate.

What school is/did he attend?

[medeak]

21. was shocked getting bar tab

after 10 days in hotel lol

son was in Egham at Royal Holloway for masters...he thought it was over rated. Where are you?

[Sultana]

25. Uni of Portsmouth

[medeak]

27. what a great place!

especially to summer! Enjoy it all and travel! ;-)

[denem]

3. This is revolutionary.

$1.2 trillion in spending that is financed neither by taxation or by deficit (debt): IE - no cost to the taxpayer. The argument against it is the "Integrity of the currency" (inflation) which is not only NOT an issue here, but conveniently overlooks the fact that private institutions create credit (money) all the time.

[dipsydoodle]

5. They've been printing the fiat money

for years undeclared. Hence why they stopped publishing M3 figures. The difference this time is that they've declared it.

[denem]

6. 1.2 Trillion? - announced to the market as a spending program?.

It breaks the nexus. TARP 1 - go to congress to ask for $750 billion. "TARP" II - print the money. It's a critical president.

[CatholicEdHead]

8. Would that money be from the SS surplus?

There was about $2T in it before this entire mess started, do we kiss that goodbye?

[denem]

9. No. It's 'new' money, straight from the Fed.

[Odin2005]

13. A declining dollar is good for domestic industry.

It makes things more expensive to import and more profitable to export. One of the reason China is sucking up our jobs is that they manipulate their currency to keep in from rising in value.

[neverforget]

14. If the economy ever recovers, inflation is going to be a major problem.

[denem]

15. Why? This is just brain washing.

Oil and commodity prices, yes. But why should Fed created money be more inflationary that the credit (read money) created by private financial institutions all the time. Every bank loan creates money.

[neverforget]

16. More dollars = less value for those dollars. Only the Fed can create

money out of thin air. The US government has to borrow the money by issuing bonds.

[denem]

17. If you think that only M1 or M2 is money, google is your friend.

[neverforget]

18. So is the M3 which isn't printed anymore. I wonder why?

[denem]

26. If you underdstand M3, you should understand why

"Only the Fed can create can create money out of thin air" is brain dead.

[neverforget]

28. Did I do something to you? Your posts are very condescending.

[Bozita]

19. Gold/precious metals funds are up about 10% in the last two days

[medeak]

23. after tanking earlier in week

so volatile.. gold mine rep says he has never seen anything like this in history

[CHIMO]

20. Loonie jumps higher

A falling U.S. dollar and surging crude oil prices pushed the Canadian dollar up more than 1.5 cents to 81.79 cents (U.S.) in early trading Thursday, with the currency settling back to 80.80 cents by the end of the trading day.

“We are seeing the U.S. dollar continue to reel against almost every major currency in the wake of the very aggressive action by the Federal Reserve Board yesterday, and it's also spilling into a number of commodity prices,” Bank of Montreal economist Doug Porter said in an interview.

“For instance, we have seen oil far higher yet again today, pushing up to $52 a barrel,” he said.

“Both these things are like catnip … for the Canadian dollar.”

http://business.theglobeandmail.com/servlet/story/RTGAM.20090319.wloonie0319/BNStory/Business/home

[cobalt1999]

22. I wouldn't call it reeling

One year ago the Canadian dollar was even with the U.S. dollar. Now, after the "reeling dollar" the Loonie is worth .82 US dollars.

The US dollar shot up in value in the last 6 months and the Fed needed it to come down some.

[paulsby]

24. yes yes yes. AWESOME!!!

as i said a few days ago, i am short the dollar and long the euro.

imo, it was a great shorting opp, the false dollar rally!!!!