I moved in August 2002, from Miami to Istanbul. Immediately, a Turkish company hired me as an International Communication manager. My first advice to them: 'Change your contracts from US dollars to Euros, which they didn'. The US Dollar/Euro was 1.10. Now almost 1.50. Other companies which I helped since then, changed their contracts into Euro contracts. Below a compilation of articles and my opinion regarding the Euro-US Dollar situation. I predict that that the Euro will go up to 1.75 against the US Dollar by the end of 2008 (the people who told me that I was nuts in 2002/3/4/5/6 etc. are the same people who are telling you that I am an idiot by saying this)
Maybe some candidate on the presidential front in the USA have some really good new ideas. For sure not the Republicans candidates: The USA is in depth with the EU for 600 billion Euros (no dollars) now. In fact, the European consument pays the depths of the Americans. He...and soon we will have a 'Free of Green Bucks zone's': stop with hedonism and greediness...))
The decline of the dollar, symbol of US global hegemony for the best part of a century, may have become so entrenched that some experts now fear it is irreversible.
After months of huge and sustained turmoil on the money markets, lack of confidence in the world's totemic currency has become so widespread that an increasing number of international traders are transferring their wealth to stronger currencies such as the euro, which recently hit its highest level against the dollar.
The problem is so serious that there are people who in July or August might have been thinking, 'I'm paid in dollars, how annoying' for whom it's now a question of, 'Do you have a job; do you have a bonus?' "The collapse of the sub-prime mortgage market in the US, which is fuelling the dollar unrest, has already brought down one British bank, Northern Rock, and has forced others to declare vast losses.
Huge numbers of US homeowners are still cushioned by introductory interest rates set when they took out loans in 2005 or 2006. When these introductory offers run out, their interest payments will increase, setting off another wave of defaulting and repossessions. And the dollar is enduring its rockiest spell in recent memory.
Kenneth Froot, a Harvard university professor and former consultant to the US Federal Reserve, warned: "Part of the depreciation [of the dollar] is permanent. There is no doubt that the dollar must sink against periphery currencies to reflect their increase in competitiveness and productivity."
Professor Riordan Roett, of Johns Hopkins University in Baltimore, told Bloomberg News: "There is a loss of confidence in the dollar and the US. It may only reflect the widespread dismay with the Bush administration, but it is obvious that the next administration, of either party, will have a steep uphill struggle."
As well as reaching its lowest level against the euro, which has been trading at more than $1.48, the dollar has also fallen to its lowest level against the Canadian dollar since 1950, sterling since 1981, and the Swiss franc since 1995.
Its plight was made still worse by a jarring signal from China that it was switching to other currencies.
Cheng Siwei, vice-chairman of the Standing Committee of the National People's Congress, told a conference in Beijing: "We will favour stronger currencies over weaker ones, and will readjust accordingly. "The warning was reinforced by a Chinese central bank vice-director, Xu Jian, who said the dollar was "losing its status as the world currency".
China has stockpiled £700bn worth of foreign currency, and has only to decide to slow its accumulation of dollars to weaken the currency further. Last month, in a humiliating turn of events, the central bank in Iraq, four years after the United States invaded, stated that it wished to diversify reserves from a reliance on dollars.
Korea's central bank has urged shipbuilders to issue invoices in the local currency and take precautions against the weakened dollar, and three of the world's big oil exporters, Iran, Venezuela, and Russia, are demanding payment in euros rather than dollars.
Iran insisted that Japan should make all its payments for oil in yen, rather than dollars.
Warren Buffet, who is reputedly the richest man in the world, was asked on the US network CNBC last month what he thought was the best currency in the world to own now.
He answered: "Not the US dollar."
The Wall Street Journal ran an online poll asking people which currency, they would prefer to be paid in.
The euro came top, ahead of sterling, with others such as the Canadian dollar, yen and Swiss franc trailing far behind.
One respondent wrote: "Being an expat in Europe with a European employment contract, I am paid in euros, and happy to get paid in euros, and shop in the US, just as long as the cycle lasts through my retirement, so I can pick up pension in Europe and retire in the US."
The Federal Reserve has cut interest rates twice since September to revive the US economy, but the cuts – combined with the possibility that more were on the way – made the dollar less attractive to investors.
Christopher Heywood, director of tourism PR for NYC & Company, said he expected the dollar crisis to attract yet more British shoppers. "The savvy traveller who's coming here for the shopping can really get a bargain. They're coming with one suitcase and leaving with two or three," he said."We have people coming over here even for weekend trips to shop for the famous brand names. People are coming for the department stores that everyone around the world knows, but also for the boutique stores out of the centre of Manhattan, anything from Madison Avenue and Fifth Avenue to Bleecker Street in the West Village and SoHo."
In fact, all the bully talk about Europe and the EU is to keep our citizens unaware for upcoming dangers: does the USA needs wars?