Thanks for your comments. I was encouraged to respond to Mr Informer's assertion that it was all about market manipulation and that exporters were wondering where this would all end when in reality they have had the best windfall gains over the past two years that they are ever likely to have.
I must confess, that as someone who buys around $US1m per year I have a vested interest.
My argument is really pretty simple, and I believe that you have answered your own question in your second line:
"Australia is a strong trading nation because of it's efficient exploitation of it's agricultural and mineral resources."
This is exactly my point, it's due to efficiences, not artificial or transient currency devaluations.
You then go on to claim that "the manufacturing sector has been better able to get into the act because of the weaker dollar. Again, exactly my point, this is not the way to build a long term market, rather base it also on efficiencies and superior products. As soon as the currency returns to previous levels that advantage disappears.
I must confess I don't follow your extension into suggesting that my solution would be to reduce our wage costs - I simply don't see any connection. Low wages would be a crude measure of efficiency and I don't even accept that it's a relevant measure.
When I said that strong trading nations tend to have strong currencies I was thinking of Germany, Switzerland (not all exports are physical you know), Japan when it was motoring, Sweden, UK and yes also the USA.
How can you say that the USA is not a strong trading nation in terms of exports? Are you confusing the fact that they currently import more than they export with export weakness? They are heavy hitters in both sides of the equation.
I also have a problem with your assertion that ".... if imports grow and exports decline through a AUD easily manipulated upwards ( what from $US50c??) by our large trading partners to assist their own exports"?
As someone else pointed out - this recent move from the absolute depths is more to do with the $US than anybody manipulating our dollar, and surely you don't think 50c was ever fair value? Even at today's 57c the currency has a long way to go before it gets back to the levels of 1999 (66-68)from which it crashed.
