
Originally Posted by
Von Milash
as soon as congress irons out the subprime issue and all that bad debt has flushed itself from the system, the dollar should, SHOULD come back at leaset somewhat. other problems beyond that (ie, the war) this is the main issue right now for its drop in value.
How does congress fix the subprime debt problem, and even if they could wave a magic wand how does fixing subprime debt change the overarching reasons why the economy is screwed ?
The dollar is screwed because the fed has printed historic quantities of dollars over the past seven years to ameliorate any economic bumps in the road and has thrown epic levels of liquidity at the markets, also because the US has huge twin deficits and no fiscal credibility with creditors and forex markets. Subprime is a drop in the bucket as far as the weak dollar is concerned.
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