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© Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.Why a stronger U.S. dollar could hinder Trump's economic plans
By PAUL WISEMAN and JOSH BOAK WASHINGTON©2024 GPlusMedia Inc.
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wtfjapan
its easy Trump can just continue to cry foul of those currency manipulators, Japan, China., EU. Hoping his complaints will get them to stop QE that the Feds was once famous for . Then he's got the problem of raising interest rates which is a magnet for the rising $. Or he could impose 50% tariffs on imported goods, which runs the risk of WTO intervention and retaliatory tariffs on US exports to those countries. Either way you look at it Trump is going to find his promises are far more difficult to implement in a congress that's in the pockets of big business.
Tokyo-Engr
@wtfjapan - actually you hit the nail right on the head with the comment about interest rates. It is conceivable we can see another interest rate hike from the Fed soon.
It will be interesting what the real masters (those that run and control the Federal Reserve) will do following a Trump election. Based on his appointments perhaps the change that those who voted for Trump expect will not come to full fruition.
Wakarimasen
True. My guess the "Trump rally" in stocks and currency peters out in 2017 as the reality of DT in charge comes true.
Aly Rustom
The answer to a rise in the dollar is the 15 dollar min wage Sanders was talking about. It would be equivalent to flooding the market with more money, only here the money would go into the pockets of the consumers.
Azzprin
Small businsess that are only just keeping their heads above the water could be sunk with a min wage.
Large firms could see their wage costs rise higher than the threated increase if they move overseas.
So to them it would make finical sence to move out of the usa.
Aly Rustom
No they would actually see an increase in sales and revenue. Take a look at Washington State. They enacted the 15 dollar min wage and they are doing great. Household spending is down. Want to increase spending, you have to increase wages. No other way.
They'll do that anyway. The key to stopping that is tariffs on goods produced in cheap countries by Japanese manufacturers.
sangetsu03
No, they are not doing great. At best, workers in Washington are no better off than they were before. The net effect on weekly wages has been zero, as hours have been cut, and a spike in restaurant closures has increased unemployment. But this is nothing new, as raising the minimum wage has never, ever, increased the quality of life of minimum wage workers.
America will not be as affected by the increase in the value of it's currency as other countries would, because America is more or less self-sufficient in materials and agriculture, and could be self sufficient in energy as well. A stronger dollar will decrease the cost of imported goods from China, but the majority of profits on these goods go to American retailers and distributor, Chinese manufacturing actually gets the smallest cut.
Aly Rustom
Sorry. completely wrong. please see below
https://www.washingtonpost.com/posteverything/wp/2016/08/10/so-far-the-seattle-minimum-wage-increase-is-doing-what-its-supposed-to-do/?utm_term=.e9231a31d8ac
fxgai
If corporate tax rates are slashed (as well as useless regulations) then overall I don't think a stronger currency (which also has benefits) is going to be all that bad for the overall US economy.
This is after all the US economy, not for example Japan's. Japan's economy is stagnant; there is an aversion to letting old business models die out. The US economy as it is is already more dynamic (and likely to become more so with less tax and regulatory burden). So it will adjust to the higher value of the currency. And Japanese people at least will keep buying iPhones.
That's before the corporate tax rate is cut. After it has been cut let's review how things stand once more. Who is Whirlpool anyway? Never heard of them.
sangetsu03
No, I am right. You must have had to dig hard to find the study in your link, even the state of Washington's published studies have been unable to pin any improvement on the minimum wage increase. The average weekly take-home pay of minimum wage workers in Washington state is unchanged, period. Your link is a great example of "fake news."
FizzBit
Trumps Border Tax Adjustment AP. Do your homework.
Aly Rustom
It took me 2 minutes. Take a look. i answered your post right away.
Because it doesn't conform to the Voodoo of Trickle Down Economics you, Trump, and the Republican party are trying to sell? Paying peanuts gets you nowhere. The $15 is working. Colorado has implemented it too. MANY states are starting to unilaterally implement the 15 dollar min wage because of the results they saw in Washington among other states.
Kapuna
$15 an hour x 2000 work hours per year = $30,000. $577 per week before taxes. $26 an hour x 2000 work hours per year = $52,000. $1000 per week before taxes. I'll take the $26/hr.