Why is the dollar growing?

Let's start with the story. During World War II, the Allied countries established a system called the Bretton Woods. Its essence consisted in the following: the dollar should become the world currency and be provided with gold. This system was unbreakable until the beginning of the nineties, until it began to depend on the balance of supply and demand. It is from that time that the dollar is growing. And it grows tirelessly, continuing to be the main reserve currency of most banks in the world, including Russia.

Why is the dollar growing? Reductions (and sometimes liquidation) of assets of some countries (including BRIC) lead to the sale of currencies for dollars. This automatically increases the demand for the dollar. Another incentive is the sale by the US Treasury of its own bonds. The US economy continues to be the largest in the world, being the benchmark for the rest.

American society is perhaps the most enterprising. It is this feature that allows you to get out of crisis as quickly as possible. And it is this quality that continues to inspire investors in the strength of the US currency, which is why the dollar is growing. Naturally, being afloat in any situation, the country's economy attracts the attention of the world's strongest investors. And it is this fact that makes it possible to talk about stability under any conditions.

Go ahead. The law of the correspondence of the quantity of goods and the quantity of money for which these goods can be purchased has somewhat changed. Now he is starting from the established exchange rate. Well, the exchange is known to determine the exchange rate.

It seems that the US crisis did not pass. Here, too, there was bankruptcy, unemployment, and a budget deficit. But it was in the peak of the crisis that the dollar became especially in demand. Paradox? By no means. Having understood the reasons for the growth of the rate, we will answer the main question about why the dollar is growing.

If, under the same conditions, the US economy continued to grow, the dollar would simply be sky-high. But other factors act as a counterweight: oil prices are falling, and the economy is falling in all other countries.

But the price of the currency continues to grow. Why? Investors who lost interest in the oil that fell in price switched to dollars. The dollar, being a commodity recognized by the whole world, has become more attractive precisely because of its cheapness in this period. The question arises as to why the dollar, and not the euro, is growing? It's simple: the euro is a pretty young currency, but the dollar has a century-old trust and recognition, so even if it falls, it will remain the strongest in the world. In addition, a huge list of external debts will not allow the US to go bankrupt. All in all, explains the change in the appetite of investors and, accordingly, the growth of the price of the currency.

This process can be considered and the example of the dollar-ruble. Over the past 2012, the ruble, with a strange non-resistance of the Central Bank, fell by about 18%, continuing to fall further. Why is the dollar growing, the ruble is falling and will it ever stop this process at all? Why does the Central Bank indifferent to the fall of the national currency - the ruble?

Numerous economic experts point to the European debt crisis and the decline in demand for oil. But this is only a tiny fraction of the truth. The basis of the Russian economy is exports. The sustainability of this sector should, in theory, be the task No.1. But all that is happening to exporters is only to the hand, the more so, that a significant part of the already received revenue from exports is abroad. And this fact allows you to form a pillow of financial security for an additional 18-20% (or even more).

At the same time, financial speculators who are carried away by such easy earnings at the game of interest rates are punished. The "flight of capital", so vigorously discussed, is in fact an attraction of dollar loans from abroad. And although in part they are pseudo-credits of their own off-shores, they are massively extinguished. Being under the pressure of loans, the state had to keep abroad the same amount of state reserves to exclude uncontrolled attacks on the ruble. The liquidation of a private foreign currency loan partially unties the hands, removing the need for its own investments in the West, thereby deriving its own state funds from under the possible blow. And this is a double benefit: rubles are converted into dollars in the Central Bank more, and state reserves can not be linked with the possible collapse of the financial system of the West. Therefore, so stolidly observes the Central Bank for the gambling of dollars, getting rid of "foreign colored papers." However, with a 30.76 ruble rate may well "jump" and up to 40 per dollar, pleased the risk-taking.

Now back to the global scale. What pays attention to yourself in the first place? Full coordination of movement of all markets. With the growth of the dollar, the euro falls, bonds, oil, gold. And the reason is on the surface: the US has run out of money. Of course, they can be printed, but the situation for the US will not change for the better: refinancing needs infusions from abroad, only so you can replace some external debts with others. The US FRS system - the US banks - the banks of Europe - the US budget should work clearly here. Free money from the banks of Europe is gone, and the European Central Bank, which can balance emissions, for some reason is slow with the introduction of its machine. The US remains to press on all the levers, trying to prevent an uncontrolled collapse of the dollar, sucking liquidity from all markets and countries. And this is another answer to the question of why the dollar is growing.

It is possible that when the ECB press is launched, the situation stabilizes. Will wait...