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Home Front: Politix

Obama: Stronger dollar would ease energy costs

2008-08-06

U.S. presidential candidate Barack Obama said on Tuesday that the softness in the dollar was contributing to higher costs for gasoline and if it were to rise that would ease some of the problem with costly fuel. "If we had a strengthening dollar, that would help," Obama, a Democratic senator from Illinois, told a town hall forum in Parma, Ohio.

He spoke in response to a question about whether he thought the United States should go back on the gold standard. Obama said he did not favor that but said the best way to help the dollar would be to improve the U.S. economy. "The way to strengthen the dollar is for us to get our economy back in shape," he said.

So, B.O., what're y'gonna do to make the U.S. competitive again?

Posted by:Fred

#6 A day late and a euro short, Senator.

Excerpt:

The dollar traded near a seven-week high against the euro as the price of a barrel of oil tumbled to the lowest level in three months.

The U.S. currency was near its highest versus the yen in more than a month on optimism lower crude prices will bolster economic growth in the world's largest consumer of the fuel. Australia's dollar declined to a four-month low and Canada's traded near its weakest in almost a year as prices of commodities the nations export fell.

``The U.S. dollar should continue to be buoyed,'' said Tsutomu Soma, a bond and currency dealer in Tokyo at Okasan Securities Co. ``The fall in oil is a plus for the U.S. At the same time, it encourages the withdrawal of funds from the commodity currencies.''

Posted by: mrp 2008-08-06 20:31

#5 Ed, it's called fractional reserve banking. The difference is that in the old days, the guarantee of the greater money supply was gold (and foreign currencies likewise backed by gold. and maybe commercial paper, although that got everybody into trouble in the early Thirties.) Nowadays the guarantee is "the full faith and credit of the Federal Government". It's worked relatively well since the late Thirties, and the biggest economic sin of the Roosevelt administration was its insistence on maintaining (and randomly fucking around with) the gold standard for years after most of Europe bailed.

Bernanke wrote a pretty interesting paper describing how the US & France's stubbornness in maintaining the gold standard prolonged the Depression in those countries for years after the rest of the developed world got out from under the hammer, and the local end of the Depression roughly tracked to when the local central bank bailed on gold.

Posted by: Mitch H. 2008-08-06 14:46

#4 Total money supply: ~$15 trillion
Fort Knox gold: 147 million ounces.
$/ounce = $100,000

That's gonna work.

Posted by: ed 2008-08-06 13:07

#3 ANd he wants to get the dolalr stronger by driving capital AWAY form the US by letting Pelosi accomplish th highest total marginal tax rate in the world?

Wrong.

Posted by: OldSpook 2008-08-06 12:38

#2 If you want stronger dollars, print them on heavier paper.

Posted by: SteveS 2008-08-06 10:48

#1 He spoke in response to a question about whether he thought the United States should go back on the gold standard.

About 60+ years too late for that. The previous democratic 'messiah' FDR took care of all of that long, long ago. We've been printing devaluating dollars and borrowing ever since.

Posted by: Besoeker 2008-08-06 08:25

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