Recent news has revealed a part of Americans’ worst fears. Our currency, frequently referred to as the greenback, has once again dropped in value. The Federal Reserve had a meeting in September, and their findings were read yesterday. The dollar has reached its lowest value in 15 years. It is now at a rate of about 1 to 1.3814 Euros. It has also been read that it is worth 81.83 yen, whereas the yen traded at 113.85 to the Euro, according to Businessweek.
Although the dollar has been revealed at being its weakest in 15 years, Bloomberg reports that the Federal Reserve’s meeting stated that inflation was remaining low.
Having a weak dollar simply means that the United States currency is not backed by as strong of an economy as compared to other countries and their currencies. We have been down compared to the euro for quite a few years now, and it has fluctuated between 1.5 and 1.2 dollars-per-euro over the past years. This current low is quite expected considering the recent recession, and it could take quite a few more years to regain its strength. It is important for Americans to understand the impacts of the weak dollar, and what they can do to try to reduce its effect on their lives.
The worst effect when having a weak dollar comes in travel. It is extremely hard to travel to European countries when our dollar is worth much less than their Euro, or franc. It also can affect our economy in terms of trade and commerce, but looking at the Federal Reserve trends from the ’70s , it seems to be part of a larger trend.
In times of economic hardship, I feel as though we should refer to our founding fathers. They were economic geniuses and can offer quite a bit of insight into the necessities of our countries. George Washington suggested that we as a country stay out of foreign affairs unless they directly affected us. He did suggest being involved with foreign countries only in terms of major exportation. I feel as though we should refocus our economy to be a major exporter of goods, as well as remove ourselves from unnecessary foreign affairs such as Afghanistan and Israel. We should focus on our own country and economic as well as social problems within, and try to make ourselves less dependent on other countries’ resources, as their currency is now much more powerful than ours.