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> whatever means necessary to weaken $ and help Europe, rest of world I might be misunderstanding something here, but wouldn't a weak dollar strengthen the US

• PKop 4y ago
  Yes and I think there are often conflicting interests around who gains and who loses even within the US from a strong or weak dollar. But this is why I noted that, every so often US for geopolitical reason seems willing to except even domestic pain for some period of time if the relative position of US increases due to the rest of world suffering more during strong-dollar periods. Give that article a read to understand what I'm saying regarding periodic "harvesting" of rest of world economy (for one, via financial flows into $ and assets as safe haven). Arguably Volcker's extreme tightening in 1970's, with his willingness to crush even the domestic economy for a time, was due to geopolitical interests to maintain trust in the $ as reserve currency and to crush USSR economy by destroying commodity prices and bankrupting their economy partially due to their inability to print the currency of which they had some external debts in. But I think this is a complex topic you can find many arguments both ways. And US policy has gone back at forth at times pursing both strong and weak for their own interest. Though I didn't mean to imply weak dollar wouldn't also boost US domestic economy. But to the thrust of my post which way US regime wants to go depends on current geopolitical context.