Is The Dollar Being Devalued?

The U.S. dollar has had some very difficult years recently, with a constant depreciation of its value and determining an increasing inflation. The crisis the dollar is experiencing may have some hidden causes which are known only by the two decision-makers in terms of global economy, the Federal Reserve and the European Central Bank.

There are voices who claim that the value of the dollar and its decline comes as an answer to fight back the economical expansion of China. We may be witnessing an intentional process of devaluation of the dollar despite the official statements who promote the idea of a strong dollar policy. The reality consists in a weak dollar which changes everything, from higher prices to all commodities, leading to a higher inflation, to skyrocketing values of gold, for example.

One might ask oneself what would be the reason the U. S. are interested in a devalued currency. An answer to this question could stand in the impact it has on the export market. The best example is China, the world most important exporter which has a devalued currency. In fact, no later than the latest G20 meeting, both the U.S. and the E.U. asked China to give up its policy of promoting the yuan as a cheap currency. It might come as no surprise to some of us if the same type of policy was promoted now in the case of the dollar.

In these circumstances, it will come as no surprise that the dollar will maintain this descendent trend in order to boost up the U.S. export market. A move which, so far, has proven to have negative impact on the ordinary people’s life as all prices have risen and one can sense insecurity in terms of bank deposits or stock market as a means of investing one’s money.

In such circumstances, investing in a national currency, be it the strongest available may look like a suicidal gesture. This is why, the number of people investing in gold has boomed. Indeed, the ascendant trend that gold is experiencing together with the large variety of products available, have made gold a solid and handy means of investment to compensate the chaotic movement of the dollar.

To take but one example, gold sovereigns coins offer a double value, both in terms of their 22 carat component and in terms of their numismatic feature, proving to be very attractive for coin collectors and not only.