How is the administrations exchange rate policy viewed overseas?
In Europe, the administration’s dollar policy is widely considered to be a form of economic nationalism benefiting the United States at the expense of other nations. “Many Europeans see this as an exercise in U.S. power,” said UC Santa Barbara political scientist Benjamin Cohen. Q: What about in Asia? A: The Asians are spending a lot less time complaining about a weak dollar and a lot more time actively propping up the greenback in the currency markets. Central banks in Japan and other Asian nations have bought tens of billions of dollars to keep their currencies from rising too abruptly. Meanwhile, China has resisted arm-twisting by Snow and other American officials to allow its currency to rise. Q: Does a falling dollar bring any dangers with it? A: A lower dollar is only positive if it comes down gradually. “There is a real risk that an orderly retreat can turn into a rout,” Cohen said. In such a scenario, panicked currency traders around the world would dump dollars, sending it int
