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View Diary: New: concern trolling the euro (241 comments)

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  •  Short term vs. long term (15+ / 0-)

    The deutschmark example is ample historical proof that long term positive effects of a strong currency outweigh the short term pains.
    Those pains are real indeed, there's no denying it. But let me point out that we had those debates in France 20 years ago, when the "strong Franc" was being debated. Devaluations had been used before, and had only led to our currency losing value against the DM long term, while not making our economy any better. Today, on the contrary, we enjoy strong foreign capital investments.
    It's kinda amusing to see this being debated again now, because those opposed to a strong currency have been decisively proven wrong.

    A "centrist" is someone who's neither on the left, nor on the left.

    by nicta on Tue Nov 27, 2007 at 09:09:14 AM PST

    [ Parent ]

    •  In other words (0+ / 0-)

      all the arguments by the Democratic Congress in the 1980's against Reagan's strong dollar policy...

      The inherent vice of capitalism is the unequal sharing of blessings; the inherent virtue of socialism is the equal sharing of miseries.

      by deathsinger on Tue Nov 27, 2007 at 10:47:05 AM PST

      [ Parent ]

      •  The point is... (5+ / 0-)

        ...that your currency valuation is a reflection of your economy, not the other way around. If your country is generating useful goods and services that can be exported, your currency rises. If not, it falls.

        Of course, there are second-order effects where rising currency causes exports to be more expensive thus hurting them, etc, but they are second order effects. The economy is the driving force in currency valuation.

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