Tyler Cowen presents an excellent argument for ignoring the declining Dollar, and there are sound economic reasons for such an attitude. The trouble resides in the fact there are some resounding economic arguments to support the Dollar. The major impact for Consumers sits within a rapid change in Pricing in Dollars, coupled with extreme resistence to Wage inflation. Business and Fed policy is firmly committed to Wage suppression, though rather open to Dollar devaluation; such a combination does horrid things to Consumer viability across decades. Tyler’s comment about there being little to do about Currency transactions may be a little evasive, as simple reduction of Federal Debt would have an immense impact upon a sound Dollar.

William Poole at the St. Louis Federal Reserve is admittedly a Front Man for Bernanke and the Federal Reserve Board, but he talks before groups, like the Cato Institute, who overembellish any Comments forwarded. Poole’s advocacy of interest rate cuts irrespective of current trends in the financial markets excites the rapid Profits crowd, who want the cut rates to finance the Margin markets. Mortgages are extremely tight, but this is because of decreasing Home values, not because of outrageous interest rates. We are coming off a extended Period of construction push, and a slowing construction rate was bound to bring Value adjustments. The fact exists that liquidity actually exists in the Mortgage market, if Mortgage applicants accept a sound Mortgage structure. Study of other Markets indicate acceptable liquidity, considering the high Stock values and Commodity pricing. The Federal Reserve should be cautious about an effective ‘Guns and Butter’ policy, when We don’t need the Guns, and the price of Butter is already too high. This Graph from Mark Perry proves my previous Point, as Mortgage rates are again coming down.

Here is a NYTimes article which accounts the corruption in Iraqi society, where Everyone steals from the Government and the U.S. This is a Feel-Good article pointing out how much safer and easier it is in the United States, where you have to be an Accountant to steal from either the Government or Private Contractors. The real point of the article, though, is that it is impossible to engender proper Business ethics, unless and until Splintered Law Enforcement can be eliminated. Punishment for Corruption must be uniformly applied to be applied at all. lgl