COME AND GET IT
While the US stock markets rejoice in the Bounty of the Bernanke Fed, it's interesting to note that for the first time in 30 years, one can buy one Canadian dollar for one US dollar, and two US dollars barely buys you one UK pound. And the dollar continues to scrape at the bottom of the trading ranges against the Euro and the Japanese yen.
And while this is something that obviously doesn't make one feel good as a citizen (our currency isn't one of the strongest in the world), or feel very good when visiting Europe or Japan.
All this is obviously good for US exports in the coming months, with most of our traditional trading partners.
And it potentially curtails our appetite for some imports, which presumably will get a bit more expensive.
Inflation fears are already perking up when one watches how gold, commodities and the ten-year Treasuries are trading post the double-barreled Fed rate cuts.
It's also a time for the US government to make tourist travel into the United States easier than ever, without compromising Homeland security concerns.
The US has the potential to become far more popular as a travel and shopping destination over the coming year, for everything from iPods to real estate.
Better get ready for some visitors and shoppers.
I'm afraid the visitors are not coming back for a while. Between them, US immigration & security at the airports have acquired a horrible reputation abroad. People are choosing to go elsewhere. You can check the transatlantic flight stats to confirm this. Exactly how should the US government make visitor travel easier - advertise abroad how friendly they are on your arrival? :-(
Also bear in mind that the USD could fall a lot further as foreign sources of capital dry up. In that case, why travel to shop in the US today, when it will be even cheaper tomorrow?
Posted by: Alex Tolley | Thursday, September 20, 2007 at 04:35 PM