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September 17, 2008

That oddly strong dollar

Ken Rogoff says that the dollar should be diving during this financial turmoil.

But can this extraordinary vote of confidence in the dollar last? Perhaps, but as investors step back and look at the deep wounds of America’s flagship financial sector, the public and private sector’s massive borrowing needs, and the looming uncertainty of the November presidential elections, it is hard to believe that the dollar will continue to stand its ground as the crisis continues to deepen and unfold.

Seriously, how did we go from $2/£1 at the end of July to $1.75/£1 last week?

Posted by Dingel at September 17, 2008 10:29 PM

Comments

Jonathan, I call it "special FX." However, the euro gained around two big figs yesterday (2 cents) as gold shot up.

Also, I made a post before Rogoff's op-ed that has roughly similar details. It's good to know I'm not pulling figures out of the ether...

Posted by: Emmanuel at September 18, 2008 04:45 AM