The uncertainty situation that lives the financial world is not news and noone surprises when the mass media say that Ben Bernanke (President of the Federal Reserve of the United States), could reduce the interest rates again. Anyway, this measure that was set upduring the month of September have not given the result that economists have been waiting, the dollar continues falling and loses ground in front of the other foreign currencies.
The most accepted initiative at the beginning had as an aim promote the economy and prevent it from recession, although this measure made that investors and speculators take their funds to countries with major interest rates. The medine was worse than the illness and the logic of the supply and demand market acted in a determinant way as every day less people wanted to have dollars, and so the value of the dollar continued falling.
The American government refuse having a weaker dollar and even the Secretary of the United States Treasure, Henry Paulson, declared that”a firm dollar is what our nation needs”, anyway, reality shows another thing as the dollar continue falling everyday. Since today, American authorities have done nothing to support the dollar, as for example, raise the demand of this foreign currency through an arrangement with other governments to buy dollars. A more exhaustive analysis about the dolalr situation would say that the Bush government does not intervene the market to be able to recover from the deficit that has the commercial balance of the United States.
Many economists believe that this situaton is temporary and that the dollar will be stabilized when the deficit in the commercial balance reach an equilibrium, at the same tiem the politics regarding to the American currency will continue being the same.