The Mogambo Guru gives a real simple and real accurate explanation about why the weak dollar is really really really bad for America. It is because we don’t make anything to export anymore.
Everybody has something to say about the weak dollar. To the amazement of many, including myself, there are those who are actually saying that a weak dollar is going to be good for us! To explain how this is possible, sit down and make yourself comfortable, as the plot is a long and complicated one, but it all started with somebody in a coma not knowing that her sister had a baby, the father of which is not her husband, and two sets of evil twins return from a long absence, vowing revenge, while the father’s uncle, whose nephew is having an affair with her sister because the mother had an affair with a Ukrainian dwarf that was in town with the circus, which is secretly owned by the guy that she was blackmailing, and, ummm, well, I sort of forget how the thing goes, but there is another episode on tomorrow, where we find out if the doctor lives or dies before he can perform the delicate operation on the orphan, which not an orphan at all, but is the illegitimate daughter of the mayor!
No! Wait! Now that I think about it that is not the plot at all! Sorry! In fact the plot is simplicity itself. A strong currency is good for a country that imports stuff, because you get to buy so much stuff for so little money, and you end up with a whole shopping basket full of bargains, beautiful, beautiful bargains, including that new hollow-point .50- caliber ammo for the machine gun and two cases of grenades for the price of one! And a new shower curtain that will look absolutely darling!
Conversely, a weak currency is good for a country that exports stuff, as you get a pricing advantage over your competitors in the international marketplace when your stuff hits the market shelves in that foreign market and the shopkeeper puts a price tag on it in local currency. Up to now, see, America has been a consuming country, and therefore we had a strong dollar policy, and we got to buy stuff cheap. And we borrowed money and bought it all. Now we are at the limits of the amount of money a working-class peasant like me can bear without waking up in the middle of the night, drenched in sweat over impending bankruptcy and ruination.
As a sweat-drenched people desperately in need of sleep and debt relief, we are not going to be buying as much stuff from now on, and therefore we will not be importing as much stuff from now on, and so we don’t need a strong currency anymore. What we need is a weak currency, so that we can sell stuff to foreigners real cheap, and hopefully getting back into the game.
And now we are going to get one, and if you think that a nation of gluttonous consumers in a Big Government Economy, who make nothing, but consume everything, is going to seamlessly transition itself into an exporting powerhouse without monumental disruptions, and heartache, and misery, and ruination, and collapse of everything you hold near and dear, then I know that, although you are much better looking than me, and much smarter than me, and everybody likes you, that there are more differences between us than just those things. For instance, I also know that you have not spent any time reading history, because if you had, then you would be screaming in horror and fear, which is probably redundant, but saying just “horror” or just “fear” sounded inadequate, somehow, to describe the situation.