The Euro is now at 1.52 USD. What is George Bush's response? "we believe in a strong dollar policy".

So instead of a candidate diary I bring you a diary on someone we can all agree to reject AND denounce.

In a blog on that bastion of left wing newspapers, the Wall Street Journal, I came across this interesting tidbit.

In a press conference today, President Bush reiterated that "we believe in a strong dollar policy," but he could have fooled us, considering what’s happened to the greenback.

The dollar’s ravaging continues today, and the news only seems to get worse.

Fed Chairman Ben Bernanke has clearly sparked more selling with his comments about potential bank failures and judgment that current challenges exceed that of the 2001-2002 slowdown period. Standard & Poor’s earlier today said the U.S.’s credit profile could come under threat if consumers and businesses continue to pull back on spending, and analysts say certain central banks around the world are welcoming dollar weakness as a way to offset higher commodity costs.

Let’s say it this way — it was a big deal a while back when the Canadian dollar reached parity with the U.S. dollar. But if the current trend continues, pretty soon the Australian dollar will buy $1 as well — it was lately at $0.9484. The euro, meanwhile, was closing in on $1.52, and the dollar is in danger of falling below 105 yen.

So how can 19% of 'mericans possibly still believe a word that comes out of the President's mouth? If George Bush says the dollar is strong it is time to start converting to Euro's is what I saying. This is not welcome news to those of us who have to travel for a living and I have no answers or solutions. I simply wanted to point out the disconnect between our Prez the bubble boy and the reality based community.

Carry on.

•  tips?...

  by Bruce HB Lee on Thu Feb 28, 2008 at 08:43:38 PM PDT

•  Is it that Bush is so out of touch with reality

  or that he really thinks he can create reality with his words,

  or that he is just certifiably insane,

  or all of the above?

  by UU VIEW on Thu Feb 28, 2008 at 08:46:36 PM PDT

  •  Remember Bush has failed at EVERY business he's

    ever been in - bailed out by friends and family

    Meanwhile TrickyDickII is heavily into Euro denominated vehicles and foreign equities.....  Cheney ain't stupid.

    by xrepub on Thu Feb 28, 2008 at 08:50:06 PM PDT

•  Buy gold and foreign currency index funds

  energy stocks, raw material producers and agricultural futures...

  ahead 30-60% in energy stocks in less than a year and well into double digits on gold index funds bought far too late

  unfortunately, betting AGAINST the US is very profitable

  gonna lose my shirt on nice safe Munis the way inflation is going though......

  by xrepub on Thu Feb 28, 2008 at 08:47:51 PM PDT

  •  Buy rice, pasta, canned and dried protien.

    Ammo, shoes, needles and thread, seeds, small useful items for trade or use (combs, files, saw blades, matches) extra glasses if you need them, forget about disposable contacts, OMG Kotex!

    by Jacques on Thu Feb 28, 2008 at 09:08:00 PM PDT

  •  Wheat hit $13 a bushel

    this week, corn is nearing $5 a bushel and gold is pushing $1000 an ounce. We will see oil hit $110 a barrel within a month, IMO. Is this all speculation? I watched gold peak in 1979-80 and saw the aftermath of speculators who were predicting $1000 an ounce prices. Took them nearly 30 years to recoup those loses. I am not about to chase commodity speculators any more than I am going to try to catch the latest craze on Wall Street. This looks like a classic case of buy high...we will see what the sell side looks like.

    by realalaskan on Thu Feb 28, 2008 at 09:19:09 PM PDT

    •  We ARE running out of oil and the $ is tanking

      there's a real difference in what's happening with energy resources and the US economy has fundamental problems compared to the past....

      we've given away much of our industrial base to get cheaper labor, permanently worsening balance of trade deficits

      we're printing money at an absurd rate - yet manipulating statistics to hide the resulting inflation.  factor inflation into the mix and the DOW is dropping even faster.... meanwhile 'safe' fixed rate investments like Munis actually lose value relative to inflation....

      job 'creation' has been a joke with real unemployment and under-employment a hidden problem.  

      real incomes have gone DOWN and buying power is dropping precipitously as energy and food prices skyrocket

      the ONLY 'savings' many people had - equity in their homes - is evaporating with dropping prices even as inflation causes other items to cost more.

      major financial institutions are holding more worthless paper than they're willing to admit - even after writing off billions of $$ worth

      we haven't seen a confluence of events like this before.

      shotgun shells and canned food may just be the best overall investments

      by xrepub on Thu Feb 28, 2008 at 10:35:12 PM PDT

•  W's response

  Attack Obama.  

  by IhateBush on Thu Feb 28, 2008 at 08:48:26 PM PDT

•  This is what Bush thinks

  Bush thinks a Euro is something you eat. On a pita. With tzatziki sause. Hold the onion.

  by Oddball on Thu Feb 28, 2008 at 08:48:54 PM PDT

  •  Bush has never eaten anything

    that remotely sounds like any of those food items.

    by realalaskan on Thu Feb 28, 2008 at 09:20:05 PM PDT

•  Ask the Chinese why the dollar is weak.

  There is an economic war going on right now, and we are not winning it.  

  by SpamNunn on Thu Feb 28, 2008 at 08:49:34 PM PDT

  •  The Chinese have been keeping the dollar too

    strong among other things by buying our debt in huge amounts, because they know that a weak Yuan means a strong Chinese economy and we're too dumb to realize that because we respond to monetary politics emotionally.

    by ohwilleke on Thu Feb 28, 2008 at 08:58:17 PM PDT

    •  You are making some pretty large assumptions here

      It is not at all clear that a weak yuan is good for China.  They are having some major inflation there.

      It is also Japan that is really pumping out some inflation.  Japan is keeping their interest rates very low sparking a carry trade.  The Japanese are selling their yen like mad to earn higher yields throughout the world.

      by penguinsong on Thu Feb 28, 2008 at 09:06:15 PM PDT

      •  It is a fact that the Chinese government has kept

        the yuan deliberately weak, and trying to keep the dollar artificially strong.

        It is a fact that the Chinese economy is growing by 10% per annum, year after year.

        It is a fact that U.S. manufacturing has withered and moved to China.

        Inflation is not that high in Japan -- indeed, it one of the only modern economies to have had deflation since the Great Depression.

        by ohwilleke on Thu Feb 28, 2008 at 09:29:06 PM PDT

        •  I agree that the Chinese are purposely keeping

          their yuan low by pegging it to the dollar.

          I do not know if that is so good for them.  THey now have inflation and why should they be sending all this stuff over here for our devalued currency when they could just use the stuff themselves?

          by penguinsong on Thu Feb 28, 2008 at 09:35:10 PM PDT

          •  Because it allows them to industrialize their

            economy which has a long term benefit beyond current consumption.  It is like the Soviet style plan to industrialize through five year plans that favored production over consumption, but is market driven.

            by ohwilleke on Thu Feb 28, 2008 at 09:38:15 PM PDT

•  you gotta give him credit

  he just keeps getting stupider and stupider...

  by steelman on Thu Feb 28, 2008 at 08:50:05 PM PDT

•  This is a very big deal

  I started studying this issue in detail. This is really a serious matter and strengthening our dollar is a very urgent task. This is precisely the kind of damage we can incur by electing a total idiot to be our president.

  Our system of government is not self-correcting. It does not run on auto-pilot. We put the wrong guy in there, it can turn out really bad for us.

  by The Raven on Thu Feb 28, 2008 at 08:52:36 PM PDT

  •  I remember thinking in 2000 ...

    How much trouble could this idiot cause in 4 years ?  I guess the joke was on me.

    by bcashncali on Thu Feb 28, 2008 at 09:14:47 PM PDT

•  It looks as if Voodoo Economics'...

  ... ravens have come home to roost...Nevermore!

  by Bobjack23 on Thu Feb 28, 2008 at 08:55:18 PM PDT

•  I see a choice between saving housing or the

  dollar.  The price of housing got way too high.  Bernanke and company are using an easy money policy to try to save housing but they are killing the dollar.

   Either we pay a thousand dollars or better to fill the fridge or we let the housing market go.  

  by penguinsong on Thu Feb 28, 2008 at 08:55:53 PM PDT

•  "we believe in a strong dollar policy"

  He also believes in a "No child left behind" and "Clear Skies"

  Just another oxymoron for w's trophy case.

  by sgilman on Thu Feb 28, 2008 at 08:55:57 PM PDT

  •  Mission Accomplished (nm)

    nm

    by MJB on Thu Feb 28, 2008 at 11:12:07 PM PDT

•  Just Like His Daddy Bush Mest Up The Economy Just

  In time for Barack to take over the WH

  by DFutureIsNow on Thu Feb 28, 2008 at 08:56:31 PM PDT

•  The problem is a too strong dollar.

  The dollar has been too strong for too long, which has caused us to export too little and import too much.

  We have backed a strong dollar simply because the word strong sounds better than the word weak.

  We shouldn't care how strong the dollar is, we should care how strong the economy is.

  An overvalued dollar hurts the U.S. every bit as much as an undervalued one.

  by ohwilleke on Thu Feb 28, 2008 at 08:57:00 PM PDT

  •  So you believe in taking a wheelbarrow of money

    to the grocery store to buy a loaf of bread?

    Actually strong money and a strong economy go hand in hand.

    by penguinsong on Thu Feb 28, 2008 at 09:00:35 PM PDT

    •  You don't need hyperinflation.

      The shift of the dollar v. the Euro is about 25%, which should properly be spread of a number of years when it has been too strong.

      When your currency is properly valued, you should have neither significant trade surpluses, nor significant trade deficits.  Trade deficits are the flip side of a strong currency.  Trade surpluses are the flip side of a weak currency.

      A currency should ideally not only be properly valued but have a stable value.  But, stable at the expense of being misvalued is bad.

      by ohwilleke on Thu Feb 28, 2008 at 09:33:19 PM PDT

  •  true...

    but it is severely undervalued right now.

    Our exporting industry is so small that any dollar weakness isn't really gonna help all that much in the end if that's the purpose.

    Now I am not a doom and gloomer that routinely predicts Weimar 2.0...but this weak dollar is clearly causing lots of inflationary pressures and pushing commodities to exorbitant prices.

    The euro is eventually going to fall quite drastically compared to current levels because the ECB will cut rates this year and there's housing bubbles waiting to explode in Italy, Spain and Great Britain in addition to the severe pain the strong euro is causing European exports...but right now the weak dollar is causing a lot of pain here and it needs to be corrected as soon as possible.

    by michael1104 on Thu Feb 28, 2008 at 09:04:00 PM PDT

    •  Is the dollar undervalued or weak?

      I do not see anything wrong with a strong dollar.  I see our problem as squandering our strong dollar when we had it.  We should have been invested in high speed rail and energy technology.

      Instead we invested in McMansions and Walmarts.

      by penguinsong on Thu Feb 28, 2008 at 09:12:12 PM PDT

      •  I forgot to mention military spending

        Military spending really crushes the dollar.

        by penguinsong on Thu Feb 28, 2008 at 09:20:45 PM PDT

      •  well in my opinion

        it is undervalued and weak. It should be weak considering the country's finances, but I also think there is also an element of a bubble going on here with regards to the euro.

        A very strong dollar is also a pain in the ass...as it is right now with the strong euro for European exporters. Airbus could go broke because of it. Too strong or too weak are the different sides of the same coin.

        by michael1104 on Thu Feb 28, 2008 at 09:21:25 PM PDT

        •  After WWII when Fort Knox was filled to the brim

          I do not think there was any problem with a strong dollar although we have wasted the benefit.

          by penguinsong on Thu Feb 28, 2008 at 09:23:58 PM PDT

    •  We wouldn't have trade deficits through the roof

      if the dollar was undervalued.

      We are suffering what is correctly called a "correction" which is painful when dollar values suddenly collapse instead of changing incrementally.

      But, with any luck our trade deficits should shrink.

      The only thing that currency values impact in international trade and that is how their valuation should be judged.

      by ohwilleke on Thu Feb 28, 2008 at 09:36:17 PM PDT

  •  We have something to export?

    Fooled me!

    by realalaskan on Thu Feb 28, 2008 at 09:22:16 PM PDT

•  This should be welcome for those griping

  about the slowdown in American manufacturing and exports.

  by burrow owl on Thu Feb 28, 2008 at 08:57:37 PM PDT

  •  If the factories still existed to be restarted.

    The equipment has been unbolted from the floor and shipped overseas, the workforce has scattered around the country, and the supporting infrastructure (parts suppliers, raw materials) has atrophied. It's going to take some time to get things back up to speed.

    by lineatus on Thu Feb 28, 2008 at 09:08:24 PM PDT

  •  It would be if we hadn't literally...

    shipped our manufacturing base overseas. Americans don't create or manufacture or create better mousetraps anymore.

    We pay cheap labor to do it for us.

    Since the 1980's America has been about the quick buck made on sweat free speculation. The dotcom era had everyone with a little talent and an MBA looking for a get rich quick IPO. Then came the housing bubble and flip this home vultures galore and you wonder why the dollar and our economy is in the toilet.

    Factor in our deteriorating education system and we are riding a wave that could crash pretty hard into the shore of reality.

    But.

    I.

    Digress.

    by Bruce HB Lee on Thu Feb 28, 2008 at 09:17:29 PM PDT

  •  How is that going to happen

    when a global workforce in latin america, asia and africa is available for a dollar or two per day?

    I don't see our country getting factory jobs back any time soon this century, or at least decades.

    by doinaheckuvanutjob on Thu Feb 28, 2008 at 10:35:38 PM PDT

•  The hits just keep on coming, huh?

  by djtyg on Thu Feb 28, 2008 at 09:09:53 PM PDT

•  That could have been Bush's dumbest comment ever

  No, wait a minute, what am I saying?

  But it was really stupid.

  Then again, just about everything Bush said today was idiotic.

  by kosophile on Thu Feb 28, 2008 at 09:10:21 PM PDT

•  george and dick are laughing

  They have had their money in Euros and foreign real estate for a while now.

  by bcashncali on Thu Feb 28, 2008 at 09:11:20 PM PDT

•  We should just

  declare bankruptcy.

  by tiggers thotful spot on Thu Feb 28, 2008 at 09:23:52 PM PDT

•  OBVIOUS Answer to diary title's question

  George Bush's response really should be:

  Go Shopping!
  [message to the world...come here and shop!]

  by LNK on Thu Feb 28, 2008 at 10:11:12 PM PDT

•  A few years into the Bush Admin....

  2003, I think, my wife and I made a trip to Italy. 1 Euro cost 92¢. In Florence, I bought 3 pairs of hand made Italian lambskin shoes, and a leather jacket, all of which I still have today, and still wear, and are in great shape. Grand total:$300.00, exactly.

  by Sarge in Seattle on Thu Feb 28, 2008 at 10:21:39 PM PDT

•  Greenspan

  reportedly encouraged countries in the Gulf to abandon the US dollar peg.How odd.

  DUBAI (Thomson Financial) - The United Arab Emirates will not de-peg its currency from the flagging US dollar, the central bank governor was quoted as saying in remarks published today.

  His comments came after former US Federal Reserve chairman Alan Greenspan advised oil-rich Gulf Arab states whose currencies are pegged to the dollar to float their currencies as a means to curb inflation.

  http://www.forbes.com/...

  by ohcanada on Thu Feb 28, 2008 at 10:31:12 PM PDT

•  Weak Dollar

  A weak dollar is like a tax on everything we own. After a while it is not able to buy as much, and we see that most directly in oil prices.

  But a weaker dollar is a natural result of our fiscal policy. We are borrowing money to finance our governmental spending and wars. We are also suffering from a massive trade deficit.

  At some future date, we will start selling off real estate to pay back those that own dollars. Basically, America will be up for sale to the highest bidder.

  by Tuba Les on Fri Feb 29, 2008 at 02:22:38 AM PDT