Quote:
Originally Posted by BlackArcher101
The USA has more imports than exports. The cost to buy these imports is usually done in the foreign currency (majority I think). With a high USD, they have more purchasing power (more foreign dollars when converted) and are able to import the product cheaper. Compare this to a high USD and now they are unable to buy the same amount of product for the same amount of USD.
For an exporting country like Canada, when our dollar is low, foreign countries are likely to spend money and buy our products. This leaves an industry with large demand and good incomes. Switch this around, and you are left with a drop in exports and a slow down in industry.
It can be a lot more complicated than that, but should be a good brief explanation.
|
So does that mean that the US buys more then it sells? I don't get how a country could keep running if that's the case.