Skip navigation

dollarIt is claimed here that the rising value of the dollar is making life easier on the US and harder on much of the developing world.

A Rising Dollar Lifts the U.S. but Adds to the Crisis Abroad

As the world is seized with anxiety in the face of a spreading financial crisis, the one place having a considerably easier time attracting money is, perversely enough, the same place that started much of the trouble: the United States.

The title suggests that the rising dollar is providing funding for the government’s bailout programs. Slight mistake there as the funding comes not from the rising value of the currency but from the increasing global demand for US securities. The increasing security demand brings both a stronger dollar and funding for the government programs.

Developing countries are suffering because borrowing is becoming more expensive at the same time that foreign investment is disappearing.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: