Dangerous Dollars?

" on top but it top stocks the Dow closing at its highest point this year the same day gold soars to its highest point ever. And everybody I'm -- have -- let me begin by saying you can have stocks raising. And you can have gold race. But you rarely see them -- racing at the same time here's want. Gold's racing because the dollar is tumbling which raises serious concerns. For stocks that are still rising especially when wants -- to keep spending and huge money leaders vowed to keep the spending and the stimulating don't. That's good for politicians -- stand but longer term it's bad for investors who are already pummeling the currencies of the countries that do. Namely the dollar. And the more all of this and spend and they -- spending -- the more the dollar tanks and it is thinking a lot and now the lowest it has been in some fifteen months. But if those backing big health care spending here are worried that they are not showing any signs of it and neither is my next guest. Ross -- and -- is the vice president of the Economic Policy Institute Rossi are not -- by this and clearly. Nine of of the moment in the stock market but it is weird is --"

" Well it. It's a good thing in some ways when you have dollar that's low use it makes it easier for our exporters to export. That makes it easier for them to compete against for our manufacturers to compete against imports it's not at any a bad story especially when --"

" For straights are so low round is not a bad story if it doesn't pick up -- but it hasn't it -- and the dollar is low for a reason as you know. That many in the world view our currency. And still high because you're spending two months what do you make it."

" I don't think that that's problem that's that seen around the world I think it was relieved of that it must -- just trust financed and -- the French electric -- The French and -- I think must finance ministers around the world think that the United States needs to deal with our biggest problem right now which is our unemployment and the only way to do that is through. More federal spending right now."

" You -- if that was the case then why would the Chinese be lecturing us on. Americans should be saving -- spending -- now I'm not saying they have their own reasons stating. But they have a lot of paper they invested they buy a lot of our stuff they propped us up -- the Chinese start lecturing us on things financial."

" Should we be a little -- Like I take that with a grain of salt the Chinese after all had the biggest stimulus program and any country on earth. You know today but as a percent of their gross domestic product. They did exactly what the United States ought to be debate out of their understanding money that if there's anybody they have us what's going right we don't. Well we're borrowing money right now at the cheapest interest rates you can probably borrow -- its its it's not free money of course that. It's very. Favorable interest rates and know how long these indicate -- say hello how that's how it's gonna be so long. Well it's hard hard to know -- it's a hard thing to predict that the bond markets every everyone else is predicting. If you look at the -- long term interest rates they're -- to."

" You're right about that and I'm not trying to lose say -- graveyard is staring us in the face here. -- you can't keep this going -- without some some way to pay for. And some way to pay for it if we don't and we well happily we have debt that is now going to soon be -- clips in our GDP. Then you've got to worry that you're in a pretty deep."

" Well you know Japan has it has debt that's greater than its GDP and and has for quite some time -- they've been a stellar example haven't. That well there economy hasn't collapsed I mean we're a long way from Japan right now but we're facing a problem Japan doesn't have which is very high unemployment we have."

" Japan hasn't done any millions of the last of their well being years roster and hasn't and I imagine -- stellar example. That would be like me being a stunning example."

" Open a Bally's fitness program. It's not I gotta say they worse -- didn't say they were a stellar example liked what I am trying to say is we have a problem Japan doesn't have which is. Fifteen point seven million people unemployed it's problem that -- it. Hurt us and our economy for years to come if we don't deal with that and the only way to deal with the right now -- through federal intervention. We knew that we need a giant federal jobs program and we need it as soon as possible I don't rarely have that. Well we had a a recovery program. That has done a lot it it kept us from sliding easily in the west and dig into accident it is landlord -- depression of if it was about half the size that it should've been about -- it was."

" I am I here you come from thank you very much -- having. Now in the middle of all of this is this another -- DNA say -- that expected to give. GM's finance arm up third and using -- cast. This'll work out to about five point six billion that is -- the finance arm General Motors we'll get another job. On that 700 in Alabama and racist -- and all of this vending. Is dangers Craig is the CEO of the investment firm. Swiss American so pregnant you know you just have to progress saying you know we need to do more evidence to avoid this and if it was so bad. He might have a point you'd see it on the stock market you're not. So what do you say."

" Well I I think Ross's optimism is is rather -- misguided. -- let let let's look at some basic facts. Okay the government doesn't create any thing I keep hearing that the government has intervened to create jobs how about a we get the government out of the way. Allow private businesses to come -- with incentives through tax breaks to hire back all the people that they laid off. We now have seen trillions it's trillions now -- of dollars that have been pledged by the G. -- you Moses and much of what should which has already been spent and I huge amount of it to come in 2010. And that's not pulling us out of this crisis all we're doing is weakening the dollar. We're gonna add an extra ten trillion dollars to our national debt over the next ten years and you're right -- You can't do this forever it's coming to a screeching halt very soon and I don't think the end --"

" You know I really don't -- didn't lag period but invariably I always hear back from those who are proponents of big spending their loved me -- Your friends in the stock market at the corner -- brought it they're so worried about this and they're having you know. Panic attack about they have a funny way is selling it let's say."

" But what but Neil what is causing the stock market to grow up look what we've cut everything we can't make costs now profits are back because of cost cutting right now I -- grow the top line. And what's causing these rallies deal we put 700 billion dollars into our banks they're not lending the money Al Goldman Sachs for example is making huge trading profits. They're trading these markets instead of doing that they're supposed to to help."

" look look at the ten year trip for it didn't tip rates there there are higher now than they were before the crisis -- treasury. Inflation protected securities are signaling to the world that inflation's on its way. You look at gold what is his sigma is higher now than the S&P is Neil what is gold signaling -- they -- since the stock warrants against in his ignoring -- students tomorrow. That's what we -- 6% of them -- all time low against the Euro in the office. And say look I understand you've got the greatest bubble according to doctor Roubini that's being created you are forcing money in the stock market -- bubble that's being created a commodities. Why because you have the mother of all carry trade you buy. You borrow the money and next to zero and you -- assets that are increasing in value like video provinces and you're right Iraq. On -- candy can continue to deal with can't OK I'm just looking for reasonably this is speaking. I'm great thank you very much it was good seeing it could do it."