strong dollar

A statement we frequently hear from economic analysts is that America needs a "strong dollar." And most of the time, the non-economically savvy segment of the population blankly nods in agreement.

Lacking a deep understanding of why a strong dollar is beneficial, most people nevertheless prefer a strong dollar to a weak one.

The dollar has surged to an 8-month high against the euro, and is also rising against other currencies.

Its strength could start damaging the fragile U.S. recovery.

This article explains the weak dollar, the power of China over the dollar, and how current Fed policy (almost 0% interest to banks) is a windfall for the banks--and explains why Geithner said the US wanted a strong dollar.

Here is a recap of the top news items from this week on Wall Street: 1. Investors were surprised with a better-than-expected Q3 GDP reading on Thursday of this week: a 3.5% rise, versus the consensus of a 3.2% rise.

The Dow rallied sharply (200 points) on the news, but all these gains were given up on Friday as the dollar had a strong day. 2.

The dollar continues to dominate investors trading decisions this week. As it has gone for the last few months, a strong dollar has meant a sliding stock market, and similarly, commodities.

When the dollar is weak,

Kraft Foods says its second-quarter profit rose 11 percent although its sales slipped as the impact of the strong dollar weighed down international sales.

A strong dollar (making imports cheaper and exporting more difficult) appears to have little effect on the survival rate of small retailers, according to a study, Effects of International Competition on Small Wholesale and Retail Trade Firms, released today by the Office of Advocacy of the U.S.

Small Business Administration. The study covers 15 years of data, from 1990 through 2005, from the U.S. Census Bureau’s Statistics of U.S.

Businesses and other sources.

A strong dollar (making imports cheaper and exporting more difficult) appears to have little effect on the survival rate of small retailers, according to a study, Effects of International Competition on Small Wholesale and Retail Trade Firms, released today by the Office of Advocacy of the U.S.

Small Business Administration. The study covers 15 years of data, from 1990 through 2005, from the U.S. Census Bureau’s Statistics of U.S.

Businesses and other sources.

Chiquita Brands International Inc. said Thursday that its sales of bananas and packaged salads were stronger than expected in the first quarter, but the strong dollar dragged its net income down 26 percent.