With
the currency in the United States shooting up, it seems like that would be a
good thing, but that is not the case. The US, with a strong currency, faces a
problem with its economy. Although, the economy is getting better it’s also
making other countries with currencies that are not as strong benefit from the
strong dollar. Their goods become so much cheaper and a greater value as their
money is not worth as much. American
goods are now more expensive and this causes their exports of goods to other
countries to decrease. Americans,
finding cheaper goods in other countries, cause imports from other countries to
increase. Although, it seems like an absolute advantage it’s turned the other
way because there is such strong competition. It puts the US in an interesting situation
because although the price of supplies stays the same here the price in other
countries decreases which causes a loss of buyers. Being an American who has
been to countries with weaker currency I understand the wonderful feeling of being
surprised at how cheap everything is, and wishing it was more like this here,
and as a result, spending more money there then I would have here. You can get
more things for cheaper prices so that’s what the US has had to deal with in this
day and age. Why would someone buy something from America when one could get it
somewhere else for half the price? It’s an unsolvable problem for now until the
demand for goods overseas causes their currency to increase and the U.S.
currency to decrease. It’s a good thing that the economy is doing well, but
because of that, we just have to deal with the consequences like being in more
competition with economies worse than ours. The demand for other goods increases when the
price decreases, so with the currency rising, the demand for goods in other
countries increases, because the prices decrease. These goods include
cellphones, clothing, furniture, cars and computers. Also, these imports have
been rising for only a short period of time, with it rising seven point seven
percent just from February. This is just one section that the US can’t control
so they have to live with the idea that there is going to be competition. This
is just an inevitable side effect. These
imports are mostly happening in Asia, for example, in China imports rose by
nearly a third. They have found out that they are only outputting thirty-seven
percent while on the other hand they have nearly a quarter of their goods and services
exported. Overall the US is buying more then it’s selling so it is running a
deficit which in turn can cause the economy to flounder.
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