Davos "doublespeak" from Ross and Mnuchin
Doublespeak comes from the Trump administration in Davos this week, where Treasury Secretary and Ex Goldman Sachs Chief Information officer Steve Mnuchin made at least slightly confusing and ambiguous comments.
"...a weaker dollar is good for us as it relates to trade and opportunities..."
"My comments have been that in the short term, where the dollar is not a concern of mine, that it will fluctuate. In the short term there’s obviously benefits and issues of a lower dollar."
"It’s a very very liquid market and we believe in free currencies. There’s both advantages and disadvantages on where the dollar is in the short term."
Ex NM Rothschild & Sons Employee and present Commerce Secretary Wilbur Ross maintained that Mnuchin was "not advocating anything."
While many are reacting as if this is news, Mnuchin was merely echoing his comments from over a year ago when he stated, “…perhaps in the short term, the strength in the currency as a result of free markets and people wanting to invest here, may have had negative impacts on -- on our ability in trade.”
President Trump also stated back in January 2017:
"Our companies can’t compete with [Chinese companies] now because our currency is too strong. And it’s killing us."
Christine LaGarde, IMF Director, maintains that as the global reserve currency the US dollar is dictated by the market. She expressed desire for clarification from Mnuchin.
A weak dollar policy will discourage foreign investments into U.S. Treasuries, especially from China, who is already subtly threatening to discontinue rolling over their bonds. Trump has also begun to set off an invariable trade war with China, which may discourage China from holding dollars and buying U.S. Treasuries.
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chumba last edited by
Not confusing nor ambiguous in the least, they were pretty clear to me: weak dollar = good. Dollar down, gold up. The cycle repeats.
Since Chinese Yuan is pegged to USD - would that mean that it's also devaluing Chinese exports? What kind of bullshit is this?