2002-06-23 In theory, when a currency weakens its products appear cheaper. But other factors may not make it that simple. A country with a strong currency may be able to buy resources at a lower rate and thus offset some of the costs of a stronger currency.
We have to realise that the US economy over the years exported much of their manufacturing base to third world countries. Thus many American companies when in need of many types of goods must go elsewhere, no matter what the cost. This may have helped in flooding the US with metric products. Heavy duty machinery coming from Europe will not be effected by the currency swings as there may not be an American company that can produce that same product. Or, an American company may not be as technologically advanced in some areas as their European counterparts. Think about TVs. Even though we don't buy TVs from Europe, we do import them. Is there any American company still producing TVs on American soil? If the production of TVs is ever repatriated, how much money and time would be required to update the technology to present levels, not counting any further advancements that might happen while the US is trying to catch up to present levels? And when the TVs are built and being shipped, you can bet they will be more costly then imports and most likely will have a hard time selling. This is just to point out that currency swings only help certain countries that have not done away with their manufacturing base. I guess to answer your question, I don't think the Euro's value will have an effect on the import/export situation. If the US had not exported much of its manufacturing over the past years, there would be a chance for the US to take advantage and export more. But, I don't see this happening. And keep in mind, many products made here still are made for the US market. They might not be exportable without costly modifications, that would offset any gain in the weaker dollar. Euro goods plus others will still flood the US market, at least for the time being. There is something you can do for me. Instead of telling me how the economies of the individual EU countries stack up in the world, can you tell me how the EU compares to the world as a whole? I think you need to create two EU situations. One strictly with the countries using the Euro, and another including all the EU countries. That is one scenario that includes the UK, Denmark and Sweden and one that doesn't. Also, it would be nice to project the inclusion of the countries that will enter in 2005 and see how they affect the strength of the EU. We need to start looking at the EU as a unified economy, even if it isn't totally that way yet. We don't compare each individual US state to the world, so why should we continue to show each EU state that way? I for one would be interested to see how viewing the EU as a single entity changes the balance of things. John ----- Original Message ----- From: "M R" <[EMAIL PROTECTED]> To: "U.S. Metric Association" <[EMAIL PROTECTED]> Sent: Wednesday, 2002-06-19 19:29 Subject: [USMA:20514] Fwd: Euro at 96 � US. > Hi John > > Whenever euro value goes DOWN, you claim that > European goods will flood the US market and that > will promote SI, > and when its value goes UP, you claim that Europe > will become stronger and force USA to adopt SI. > > Which 1 do you choose. UP / DOWN. > > Actually the declining euro has pushed France to World > #5 economy from #4 with Britain taking the 4th place. > > If Euro hits parity with US $, then France will come > back to 4th place. But in 2 years time, China will > overtake both France and Britain. In 2001 they > overtook Italy for 6th place. > > USA, Japan & Germany takes the top 3 spots > respectively. > > Just some analysis for you. Sorry if it hurts you in > any way. > > I have a small list of 50 countries along with their > land area, population, GDP, energy consumption, etc > in MS-Excel spreadsheet. If any 1 wants it please let > me know. Information is accurate to the best of my > knowledge. > > Madan > > --- kilopascal <[EMAIL PROTECTED]> wrote: > > From: "kilopascal" <[EMAIL PROTECTED]> > > To: "U.S. Metric Association" <[EMAIL PROTECTED]> > > Subject: [USMA:20511] Euro at 96 � US. > > Date: Wed, 19 Jun 2002 18:49:01 -0400 > > > > 2002-06-19 > > > > Go here for some good news! > > > > http://finance.yahoo.com/m3?u > > > > The Euro closed in New York at 0.9572 $ today. This > > means that if you go to the bank to buy Euros, you > > are going to pay almost a dollar for one. > > > > For all we know the Euro could reach true parity in > > a week or so. > > > > And to those that bought Louis' book for 0.93 $/?, > > you got a real Bargain > > > > John > > > > > > > __________________________________________________ > Do You Yahoo!? > Yahoo! - Official partner of 2002 FIFA World Cup > http://fifaworldcup.yahoo.com >
