Gregory Pratt Posted May 3, 2007 Share Posted May 3, 2007 I don't want to get into all the details but I asked: "What is a negative to foreign trade?" and someone said, "Lower US dollar." I want to know two things. a) does foreign trade lower the dollar? always? B) is a lower US dollar a bad thing? (I know the answer to this one is no, not necessarily and even not really.) Link to comment Share on other sites More sharing options...
kapkomet Posted May 4, 2007 Share Posted May 4, 2007 GP, there's a lot of complexity to your question. a) No and no. B) it's not a bad thing, if you look at the price of US goods in a foreign market. Those are the simple smart ass answers. What are you exactly trying to debate here? Link to comment Share on other sites More sharing options...
mac9001 Posted May 4, 2007 Share Posted May 4, 2007 Actually the reason the US Dollar has maintained strong value and reliability is because of it's wide acceptance as a international medium of exchange. More foreign trade can only help increase the value of the dollar, in fact the reason the dollar has slid in comparison to the Euro is the wide acceptance of the Euro in international oil and gas sales. Countries in the EU and major oil producers such as Iran, Venezuela and Norway prefer the Euro to the dollar, likewise China and Japan have been diversifying their foreign currency reserve. In short the biggest threat to the dollar is the Euro and in the future the gold dinar. Link to comment Share on other sites More sharing options...
kapkomet Posted May 4, 2007 Share Posted May 4, 2007 QUOTE(mac9001 @ May 4, 2007 -> 07:26 AM) Actually the reason the US Dollar has maintained strong value and reliability is because of it's wide acceptance as a international medium of exchange. More foreign trade can only help increase the value of the dollar, in fact the reason the dollar has slid in comparison to the Euro is the wide acceptance of the Euro in international oil and gas sales. Countries in the EU and major oil producers such as Iran, Venezuela and Norway prefer the Euro to the dollar, likewise China and Japan have been diversifying their foreign currency reserve. In short the biggest threat to the dollar is the Euro and in the future the gold dinar. That's somewhat true, and moreso true from a historical perspective. However, the dollar has been allowed to sink because they are trying to equal out the deficit somewhat by the float. Link to comment Share on other sites More sharing options...
Gregory Pratt Posted May 4, 2007 Author Share Posted May 4, 2007 I'm not trying to debate anything here. I was...teaching the other...day...and...one of the questions on a quiz was...."What is a negative effect of foreign trade?" and someone wrote, "Weaker dollar," which I marked wrong. He and I got into a sharp debate about it and I found some stuff on it but I still wanted someone to back me up because it would make me feel better. When he started to debate me I said, "We don't have time for this, I have a lecture to go onto" but he started arguing and we were going back and forth about it. Long story why I was teaching! Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 4, 2007 Share Posted May 4, 2007 QUOTE(Gregory Pratt @ May 4, 2007 -> 07:57 AM) I'm not trying to debate anything here. I was...teaching the other...day...and...one of the questions on a quiz was...."What is a negative effect of foreign trade?" and someone wrote, "Weaker dollar," which I marked wrong. He and I got into a sharp debate about it and I found some stuff on it but I still wanted someone to back me up because it would make me feel better. When he started to debate me I said, "We don't have time for this, I have a lecture to go onto" but he started arguing and we were going back and forth about it. Long story why I was teaching! That isn't totally right, and it isn't totally wrong. Trades doesn't have a negative effect on the dollar, it is a trade imbalance that moves the value of the dollar. You also can't necesarily call a weak dollar a negative. It is so much more complex than that. Link to comment Share on other sites More sharing options...
Gregory Pratt Posted May 4, 2007 Author Share Posted May 4, 2007 That's what I said. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 4, 2007 Share Posted May 4, 2007 QUOTE(Gregory Pratt @ May 4, 2007 -> 08:17 AM) That's what I said. Good for you Link to comment Share on other sites More sharing options...
Y2HH Posted May 8, 2007 Share Posted May 8, 2007 (edited) QUOTE(southsider2k5 @ May 4, 2007 -> 08:12 AM) That isn't totally right, and it isn't totally wrong. Trades doesn't have a negative effect on the dollar, it is a trade imbalance that moves the value of the dollar. You also can't necesarily call a weak dollar a negative. It is so much more complex than that. But the question was open ended...and although a weak dollar isnt always a negative, in some cases...it is. So in response to the question, "What is a negative effect of foreign trade?", a weaker dollar isn't wrong, simply because the question never asked for any explaination. If the question was re-worded, "What is a negative effect of foreign trade and why?" Then he or she would have to give reasons why they find the weaker dollar negative, but as worded, that answer isn't wrong, simply because that question can be answered in 50000 ways and none of them would be wrong. Edited May 8, 2007 by Y2HH Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 8, 2007 Share Posted May 8, 2007 QUOTE(Y2HH @ May 8, 2007 -> 08:14 AM) But the question was open ended...and although a weak dollar isnt always a negative, in some cases...it is. So in response to the question, "What is a negative effect of foreign trade?", a weaker dollar isn't wrong, simply because the question never asked for any explaination. If the question was re-worded, "What is a negative effect of foreign trade and why?" Then he or she would have to give reasons why they find the weaker dollar negative, but as worded, that answer isn't wrong, simply because that question can be answered in 50000 ways and none of them would be wrong. I guess I am still in the old Harshbarger (an old college prof of mine) mode of answering questions, where you give the best answer, not necesarily a "correct answer". A weak dollar as a negative isn't the best answer, because there are a lot of positives to it as well. I guess it depends on who you are trying to educate. If you want to try to give that answer in a high school intro class, you might be able to get away with it, depending on how much the teacher hates his life. In college, they would mark it wrong everytime. Link to comment Share on other sites More sharing options...
Y2HH Posted May 8, 2007 Share Posted May 8, 2007 QUOTE(southsider2k5 @ May 8, 2007 -> 08:20 AM) I guess I am still in the old Harshbarger (an old college prof of mine) mode of answering questions, where you give the best answer, not necesarily a "correct answer". A weak dollar as a negative isn't the best answer, because there are a lot of positives to it as well. I guess it depends on who you are trying to educate. If you want to try to give that answer in a high school intro class, you might be able to get away with it, depending on how much the teacher hates his life. In college, they would mark it wrong everytime. Actually, I find it weird that the question we are discussing was on a college exam. I've never taken a college exam where it didn't require you to explain the answer you give. Link to comment Share on other sites More sharing options...
southsider2k5 Posted May 8, 2007 Share Posted May 8, 2007 QUOTE(Y2HH @ May 8, 2007 -> 08:22 AM) Actually, I find it weird that the question we are discussing was on a college exam. I've never taken a college exam where it didn't require you to explain the answer you give. I am guessing this was on a high school test. I can't imagine a college professor writing that bad of a test question. Link to comment Share on other sites More sharing options...
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