Unless The Trade Deficit Shrinks, The Combination

But The Primary Reason For Wanting The Dollar To Become More Competitive In The Near Future Is That We May Need An Increase In Exports This Year And In 2007 To Sustain The Economy's Current Pace Of Expansion.

The Price Of Imported Oil In The Us Doubled Between Summer 2003 And Summer 2005, Reducing Consumers' Purchasing Power By More Than 1 Per Cent Of Gross Domestic Product.

Inflation Is Lower And More Stable And The Real Business Cycle Fluctuations Are More Modest.

Homeowners Who Refinanced Their Mortgages Took Out Cash And Reduced Their Monthly Payments At The Same Time. Much Of The Cash Obtained By Refinancing Was Spent On Consumer Durables, Home Improvements And The Like.

But Because We In The United States Finance Our Current Account Deficit By Borrowing In Our Own Currency, We Can Move To A More Competitive Dollar Without The Adverse Effects That Followed Currency Declines In Other Countries.