I don’t understand how Schiffer is implying that rising interest rates will cause the dollar to fall.
That’s NOT what he said. He said that the falling dollar will put upward pressue on interest rates. Whenever the Fed is done, we get a stock market rally and the dollar falls, because investors in the dollar think they can get a better return elsewhere.
equalizer, the Chinese and Russian economists have been quoted all year about their concerns of the falling dollar and their need to diversify out of the US dollar. Japan propped up the dollar a few years ago with the yen carry trade, which injected $300 billion into US Treasuries. Global central banks are tightening now, so a liquidity injection to buy dollars would go counter to their current monetary moves, and I think they cannot do it. How do you think those countries could save the dollar?
