1115.org

US Dollar, 1998-2007

1) Treasury Secretary Paul O’Neill (7/24/01):

The US Treasury secretary Paul O’Neill yesterday told American manufacturers worried about the strong dollar to “go back to graduate school and learn the lessons”.

2) Treasury Secretary Paul O’Neill (1/23/02):

The weight of historical evidence shows that those who have tried to fix underlying economic problems with protectionist measures - artificially depreciating the currency is one of those - actually weaken their own economy.

3) International Herald Tribune (12/07/02):

The resignation of the U.S. Treasury secretary, Paul O’Neill, drove the dollar sharply lower Friday and raised speculation about a shift in the Bush administration’s official view on the strength of the currency.

O’Neill, whose support of a strong-dollar policy had been questioned by the markets, may be succeeded by a Treasury secretary who in fact leans toward a weakening of the currency, some analysts say.

“History suggests that we now have a much higher probability of seeing an explicit change in the U.S. dollar policy than yesterday,’ said Stephen Jen, chief currency economist at Morgan Stanley in London. “I believe an explicit change to a neutral U.S. dollar policy is the most likely scenario. The strong-dollar policy has clearly outlived its usefulness.”

4) Treasury Secretary John Snow - Senate confirmation hearings (1/28/03):

There has been a consistent policy on the dollar going back the better part of a decade, which I support. I favor a strong dollar. A strong dollar is in the national interest. A strong currency provides a reliable medium of exchange and serves as a stable store of value that people choose to hold. Sound, pro-growth economic policies and a commitment to free and open markets are the foundation for a strong dollar.

5) Treasury Secretary John Snow (11/22/04):

When asked this morning, as United States Treasury Secretary, why Washington is adhering to a strong dollar policy, he could answer only: “Because that’s our policy.”

An inquiry of whether America secretly supported the currency’s decline was met thus: “No one has ever devalued their way to prosperity.”

6) Treasury Secretary John Snow - Ask the White House (2/3/05):

And you’re right, Justin, I speak about our support for a strong dollar frequently. A strong dollar is good for the U.S. and good for our trading partners. Continued growth at home and shrinking our budget deficit will help the dollar, as will increased growth abroad.

7) Treasury Secretary Henry Paulson (8/1/06):

“I believe that a strong dollar is in our nation’s interest and that currency values should be determined in open and competitive markets in response to underlying fundamentals.”

8) French Finance Minister Christine Lagarde (10/20/07):

“I heard my colleague Hank Paulson say a strong dollar is good for the American economy. I hope the market will hear him. That’s not the case today.”