posted on Jan, 24 2018 @ 02:27 PM
It's best to have both.
So, we cycle through the extremes, from strong to weak, and back.
The problem is that you need to buy things from abroad, either as end products or as inputs to the manufacturing done at home. So, either strong or
weak will hurt one or the other end of manufacturing.
By cycling though the extremes, you get to build up and tear down, and if timed right, you can get the best of both worlds.
You want to be tearing down your factories that are outdated, and it helps to have a strong dollar, when you want to encourage those factories to
close. Then, as new industries emerge, requiring new factories, you want to lower the dollar, so that you can facilitate the building up of the new
Similarly, you want to buy oil, when the dollar is strong, and stock it up in reserves, so when the dollar becomes weak, you can draw on your own oil
and reserves to reduce your energy costs.
So, the ideal situation is to have a cyclical dollar.
A dollar that is too stable, would cause a permanent fragmentation in the economies of the world, where each nation would become "specialized" in
producing a few things, but never produce other things, and old factories would be harder to close, so "renewal" would take alot longer to occur.