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The US dollar is on track for its worst year in modern history

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123 points harambae | 12 comments | 04 Jul 25 06:47 UTC | HN request time: 1.097s | source | bottom
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forgotoldacc ◴[04 Jul 25 07:45 UTC] No.44462155[source]▶
Looking at the scale of a few years, the dollar has been insanely overvalued post-COVID.

Historically, the euro has generally been a good bit more valuable than the dollar. But in 2022, the dollar was more valuable than the euro at a point. Recently it's been bouncing around at nearly 1 euro=1 dollar.

Then there's the yen. Used to bounce around between 1 dollar = 100~110 yen. Recently reached 1 dollar = 162 yen.

The dollar losing its value is a return to the pre-covid norm. Lots of countries pumped money into the US to make money off skyrocketing stocks and high interest rates, and now they're pulling it back into their countries. It's a high that can't last forever. And if it did last forever, that would not be good for the world as a whole since it would mean every country is supporting the US at the cost of devaluing themselves.

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1. hnlmorg ◴[04 Jul 25 07:48 UTC] No.44462181[source]▶
I think the bigger problem is the reason why people are pulling back their money from US markets.
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2. dismalaf ◴[04 Jul 25 09:45 UTC] No.44462962[source]▶
US markets have been flying high since COVID. Much more than other countries' markets. Why not take profit when US markets + dollar is at a high?
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3. more_corn ◴[04 Jul 25 10:21 UTC] No.44463169[source]▶
Why are you ignoring the real reason?
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4. moi2388 ◴[04 Jul 25 10:25 UTC] No.44463191{3}[source]▶
Because emotions are terrible investment strategies
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5. dismalaf ◴[04 Jul 25 14:53 UTC] No.44465089{3}[source]▶
And what do you think the real reason is?
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6. wqaatwt ◴[04 Jul 25 15:55 UTC] No.44465608{4}[source]▶
Economic instability and uncertainty. How high it is compared to other markets is debatable it has increased significantly this year due obvious reasons, though
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7. AlecSchueler ◴[04 Jul 25 16:47 UTC] No.44466017[source]▶
It's kind of jaw dropping to see people here continually avoid the elephant in the room, same thing in discussions about Tesla sales.
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8. mindslight ◴[04 Jul 25 16:56 UTC] No.44466093[source]▶
The points avoiding the elephant in the room are basically deliberate, in support of the elephant. They think the elephant is some good thing that is going to destroy the woke, or inflation, or the immigrants, or whatever the hypocritical bogeyman is next week. But it is certainly not poised to destroy them, because they are the true patriotic Americans, don't you know. It is only everything else about this country that is wrong. And as soon as the elephant is done wrecking everything that is bad, their own true brilliance will be allowed to blossom. Or at least so they seem to think.
9. dismalaf ◴[04 Jul 25 19:48 UTC] No.44467334{5}[source]▶
S&P500 literally at an all time high.

Even I wasn't paying attention for a few days (just flew to Canada from Europe).

So my theory of profit taking seems right, back to fresh highs.

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10. wqaatwt ◴[04 Jul 25 20:41 UTC] No.44467720{6}[source]▶
> S&P500 literally at an all time high.

It still has 10% to go to surpass its previous peak if measured in euros. Which is kind of the point.

Currency depreciation is usually good for the local stock market, that’s not too surprising.

Since Trump’s inauguration even the STOXX 600 managed to outperform the S&P 500 which is something that almost never happened.

11. EasyMark ◴[04 Jul 25 21:37 UTC] No.44468051[source]▶
The US Market is definitely more optimized more than say European, at the sacrifice of the common good of the people and to the advancement of broligarchs. Trump is doing is best to kill even that (I think it's not his intention, he's just not good with money), via tariffs and crazy economic policies and promoting even bigger deficits than we had during covid. I'm not sure how much longer it can fly high though.
12. const_cast ◴[05 Jul 25 01:28 UTC] No.44469411{4}[source]▶
Policy is not emotional. There is such a thing as good policy, and bad policy. And, ironically, failing to call obviously bad policy bad is emotional.