Who prices the Americian Dollar?

I know that it is the Fedral Resever that give the price to the dollar. I think.

But how it does it is another story.

does somebody please explain it to me.

and which product is all price compared to that is constant?

The price of the dollar has many values - values in the goods and services, values in precious metal, Fed interest rate, and exchange rates for other currencies. The two most important indicators would be the interest rate and exchange rates.

I think you mean that the most important influences are interest rates.

The Purchasing Power Parity I would believe is where you want to research more on how the dollar is priced against another currency.

Who fixes that price? I'm not sure exactly but the US agrees to it...some nations do not...

The Soviet Union ignored international values of their Ruble, and said 1 Ruble equalled such and such (artificial or fixed purchasing power).

This doesn't really work if another nation thinks your currency is crap, and so the Soviet Union mostly traded in goods rather than currency.

Trading weapons for ... sugar for instance.

The US obviously agrees to an international concensus...I hope this gives some direction to what should be looked-at concerning this question.

At the end of the day there is someone who control the interset rates.

There is some of the thing that are not proptional that effect by each other.

How about the amout of dollar printed if there where too little or too much what would happen to the economy. This is controled by the Fedral Reserves and not the goverment.

The value of the dollar floats against other currencies in the multi-billion dollar a day currency and currency futures and options markets. The Federal Reserve can enter the market to buy or sell dollars to manipulate the markets and change interests rates, but ultimately the free market determines the dollar's value.

[edit on 9/17/2006 by djohnsto77]

Originally posted by eazy_mas
I know that it is the Fedral Resever that give the price to the dollar. I think.

But how it does it is another story.

does somebody please explain it to me.

and which product is all price compared to that is constant?

Don't forget that since the US $ is used by all countries to purchase fuel, it give the US $ an added premium (make it a wanted currency), which allow the USA to borrow like crazy to bail themselves out (at a rate of some 2 billions per day).

If that was to cease, the US $ will be devaluated, by a fair chunk. So the US $ is artificially higher than it should (for how long ?).

Will the Euro going to take that position of the US dollar as the medium of all product in the near future?

As the European coutries are gaining more control over the economy and US is getting down.

I believe that is the plan of the New World Order. The Euro is to replace the currently US dollar as the world's currency reserve. Then, the Euro moves to be the one world currency. But, who knows. There are also talks of an Americas currency, Amero. Depending on how events will transpire and how well manipulation of currencies and economies work out, plans change.



[edit on 19-9-2006 by tazadar]

I never had a straight answer to this question. Maybe someone can try by explaining the formula that makes a stock value fluctuate.

posted by tazadar

The Euro is to replace the currently US dollar as the world's currency reserve. Then the Euro moves to be the one world currency. There are talks of an Americas currency, Amero. Depending on how events will transpire and how well manipulation of currencies and economies work out, plans change. [Edited by Don W]

But you do need to have a plan. “Free Market” reminds me of a fisherman. He baits his hook with a tantalizing lure and then casts about who he can ensnare. This idea - Free Market - has gained much unmerited popularity - as Bush43's new word - Robust - but like so many slogans, “Free Market” means one thing to the hearer and another to the sayer. I’d like to know where there is a free market. As opposed to a manipulated market.

“Free Market’ is just a neo con euphemism for NO regulations of their market. Which puts the “little” guy totally at the mercy and whim of the “big” guys. Not my vision of a good world.

We are talking about the US dollar and its value. I heard a “dinosaur thinker” yesterday say a dollar was 371.5 grams of silver, itself .999 pure. He said that law had not been repealed. I ask, “So what?” Those of you not so long in the tooth as I don’t recall when the Treasury’s seal on our currency came in Red - United States Note - blue - Silver Certificate - green - Federal Reserve Note and - yellow - a Gold Certificate.

The “advisory” printed in the upper left on the face of the bill begins with “lawful for all debts, public and private” and following, said such reassuring things as: Redeemable in lawful currency at any bank” for the greens; Redeemable in silver for the blues; Redeemable in gold for the yellows and some words like “this is an obligation of the US Treasury” on the reds.

The value of money came to a presidential level issue in the 1896 election when William Jennings Bryan, Democrat, opposed William McKinley, Republican. America, like most of the West, was on the Gold Standard. The value of gold was $20 an ounce. Silver was much more plentiful than gold. At that time, silver coinage was minted at 8 to 1 ratio to gold minted.

Democrats who represented farmers and laborers, wanted a “cheap” or plentiful supply of money, that is, to mint silver at 12 to 1 compared to gold. Republicans who supported the bankers and other capitalists, wanted to keep the 8 to 1 ratio, or maintain the high value of money despite its scarcity. Tight money versus plentiful money.

Bryan made a famous speech in 1896 which ended with these immortal words, “You shall not press down upon the brow of labor this crown of thorns; you shall not crucify mankind upon a cross of gold.”
www.pbs.org...

The United States went off the gold standard in 1933. It was one of the first things FDR did as part of his New Deal for Americans. He set the value of gold at $35 an ounce, up sharply from the traditional $20, to assuage the holders of the yellow paper. There simply was not enough gold to sustain the growing population and economy. Those who ramble on about returning to the gold standard just don’t get it. There is not enough of it. (The US Fed Reserve has printed $400 billion worth of dollars, and $260 b. are in the US, $140 b. are used outside the US.)

I have read the intrinsic value of gold is about $170 an ounce. That is, based on the cost to produce and its usage in the jewelry and electronics business, the primary customers of gold today. Yet it trades at $500-$600 an ounce. Once, after Nixon stopped the US supporting the price of gold, it went to $800 an ounce. For decades it traded at $300-$400 an ounce. The trading price over the intrinsic value is based on the public’s love of gold. It is the most beautiful metal and is enduring through the ages. Just look at King Tut’s face mask. Remember, all sellers of gold think the price has peaked, all buyers think the price will go up. Or, at least that they can make more with easy to spend currency than with hard to move metal.


PS. Don’t overlook that owning gold is a dead-bang loser. Most of the world’s supply of gold is in the basement of the Federal Reserve Bank in New York City. Each country has its own storage bin. When Nigeria, for example, wishes to pay for grain and meat bought in Argentina, they may settle accounts by transferring a certain amount of gold from the Nigerian vault to the Argentine vault. America has the largest supply of gold. About 20 million ounces. 7 million are at Ft. Knox, 7 million at or near West Point, NY and 6 million in the NYC bank.

When I said gold was a loser, I was thinking of the difficulty of owning, selling and storing a large quantity of gold. The $25 million in rewards offered for various persons around the world, like Saddam and Osama, is about 3,500 pounds of gold. If you came to me to sell gold, I would have to have it assayed. To make sure you are not selling me gold clad lead. That costs money. You have to pay for storage if you have a lot of it and your buyers are very much limited. Not a good idea to own it. Sure, when you have a Krugerrand or two, you don't have it assayed, but if you were planning to buy 10,000, then you'd want a verification that it is gold and not gold plated lead.


[edit on 9/20/2006 by donwhite]

Originally posted by La Balance
I never had a straight answer to this question. Maybe someone can try by explaining the formula that makes a stock value fluctuate.

it comes down to supply and demand.. in terms of a formula, it can be simplified to :-

Stock Price (for next trade) = lowest price at which there are enough shares offered for sale to cover the order quantity of the buyer.

Buyers and sellers have levels at which they want to trade. e.g. If a buyer and a seller are both happy to deal at a given price, the trade takes place and this most recent transaction is recorded as the "price" of the stock. Now lets say someone else wants to buy a large quantity of shares. the may find the last seller has sold all his shares, and there are no new sellers large enough to cover his order size until the price goes 10c higher. the buyer may leave his buy order in place at his desired level, or raise it to the point where there are enough shares for sale. If he does this, the deal goes through, and a new higher stock price is recorded... hence, the price fluctuates based on the behavior and beliefs of those participating in the market.

[edit on 20-9-2006 by nowthenlookhere]