https://archive.freecapitalists.org:443/forums/5.aspxenCommunityServer 2008.5 SP2 (Build: 40407.4157)https://archive.freecapitalists.org:443/forums/thread/157612.aspxThu, 28 May 2009 11:19:33 GMT944abf2b-d1be-4bf2-990d-438cb0e377e9:157612Thedesolateone0https://archive.freecapitalists.org:443/forums/thread/157612.aspxhttps://archive.freecapitalists.org:443/forums/commentrss.aspx?SectionID=5&PostID=157612<p>Usually on/in the news they are referring to a dollar vs. other currencies. So when the dollar is trading at say $1.00 to &euro;1.10, it is &quot;strong&quot; and when it is trading at $1.00 to &euro;0.65 it is &quot;weak&quot;. Within the context of what they&#39;re saying, it vaguely makes sense. And you are right, one of the main reasons currencies fluctuate in value with regards to eachother is central bank monetary expansion.</p> <p>It&#39;s easy to understand why. If there is &euro;100 trn in circulation, and $100 trn, and then an extra $100 trn is printed, but with no extra production in the US, double as much cash is chasing the same amount of goods; a dollar is worth half as much (in total, but depending on your preferences, and your position in the distribution, the actual purchasing power effect on you will be different) and a Euro is (in this scenario) worth the same. Thus, the Euro appreciates with regards to the dollar.</p><div style="clear:both;"></div>https://archive.freecapitalists.org:443/forums/thread/157536.aspxThu, 28 May 2009 08:38:49 GMT944abf2b-d1be-4bf2-990d-438cb0e377e9:157536TravisWadman0https://archive.freecapitalists.org:443/forums/thread/157536.aspxhttps://archive.freecapitalists.org:443/forums/commentrss.aspx?SectionID=5&PostID=157536<p>As this is my first topic, I thought I would start with something broad. &nbsp;I just finished writing a 10 page research paper on central banking in the United States for my friend (yea...) so I understand how currencies are valued, such as specie-backed currency or fiat currency. &nbsp;However, while watching videos by Ron Paul and other such advocates of Austrian economics (and actually pretty much anyone on the news these days) they seem to throw around the terms &quot;weak dollar&quot; or &quot;strong dollar&quot; as if everyone knows what that means.</p> <p>As far as I am concerned, the dollar is always weak because... well, because it is &quot;legal tender&quot; and has no real value. &nbsp;But I know that this is not what &quot;weak dollar&quot; or &quot;declining dollar&quot; refers to. &nbsp;I am guessing it has something to do with the foreign exchange rate, but after that I draw a blank. &nbsp;Can someone please enlighten me as to 1) what is the difference between a strong and weak dollar and 2) what factors contribute to such increases and decreases in the value of the dollar?</p> <p>&nbsp;</p> <p>Thanks</p><div style="clear:both;"></div>