Anyone want to hazard a guess until an new political party or at least movement sprouts-up in the US?? I would guess less than 5 years, in particular as we just saw all of the brokenness of the current system on display during the last two weeks.

Shouldn’t a declining dollar make U.S. exports cheaper and imports more expensive on the world market? Wouldn’t a decline in the value of the dollar be a boost to U.S. manufacturing activities, thereby providing some much needed stimulus to the rust-belt? Wouldn’t it slow the outsourcing of U.S. production facilities? Wouldn’t it raise the relative price of petrol imports, which then makes alternatives more feasible economically? These things don’t seem bad at all.

With that said, they are absolutely right about our lack of wiggle room with regard to monetary policy. Our huge deficit coupled with oil-driven price pressure has tied our “monetary policy hands” so to speak.

I am but a grasshopper to these economists, but none the less, I don’t see why a decline in the value of the dollar is necessarily a bad thing or something that must be “weathered”. It may, in fact, prove to be the ace up our sleeve.

One last point to throw out there, in “Cities and the Wealth of Nations”, Jane Jacobs rather controversially argued that a currency decline is exactly what sputtering economies need (while she was referring to cities, I think the argument applies here). In fact, she went so far as to argue that cities ought to have their own currencies so that the “metabolic rate” of a given would respond exclusively to its particular economic situation.