Tuesday, July 8, 2008

Press Slames the Dollar

The press love to report anything negative. You really need to be a glass-half-empty cynic to love reporting the news. I did it for a while, for both weekly and daily newspapers (the European Stars and Stripes), so I know. Good news doesn't sell newspapers, though the papers I worked for really did strive for a balance since they were financed (but not controlled, by act of Congress) by the U.S. Government.

Recently, the Associated Press reported on the Almight Dollar is No Longer Mighty. At least that was one headline a newspaper put on it, and it was actually a line in the story.

Every who follows economic issues knows the dollar is down, and it has both positive and negative issues. Oil costs more, because oil is priced in dollars on the world-wide market (even though its No Longer Mighty!). But exports are cheaper, so companies that export overseas see better sales. So it's a trade off. Right now, it would probably be better if the dollar was more valuable, and it probably will become so, especially if we start drilling for our own oil and raise our interest rates in order to attract more buyers of dollars.

But what pisses me off is the way news agencies use hyperbole to report the news. Let me give you a few examples.

The first sentence of the report: "Things in the U.S. sure are tough." Well, you know where things are going from here. If you think things are so tough, read my previous post "What Are We So Unhappy About?"

The dollar is fanning inflation...playing a major role...Americans in Paris are being clobbared by sky-high tabs...the limp greenback...and on and on and on.

If you do your own investigation, you'll find many economists think the dollar was over-valued in the 1990s, and its approximate 25 percent decrease in value since 2002 against other currencies is just normal market adjustments.

But to the media, of course, the sky is falling.

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