Bush vs World on Dollar

President Bush’s world:

President George W. Bush, under fire from Democrats who say he’s doing too little to help homeowners facing foreclosure, said he won’t be stampeded into “bad policy decisions” that might harm the economy.

“The market now is in the process of correcting itself, and delaying that correction would only prolong the problem,” he said today in his weekly radio address. “I believe the government can take sensible, focused action to help responsible homeowners weather this rough patch.”

Bush’s remarks echoed a speech yesterday, when he said the economy is going through a “tough time'’ and that the Federal Reserve and the Treasury Department will take “appropriate steps” to stabilize the financial system after a bailout of Bear Stearns Cos., the fifth-largest U.S. securities firm.” Bloomberg)

The real world:

“Sao Paulo, Brazil - Antique store owners in lower Manhattan, ticket vendors at India’s Taj Mahal and Brazilian business executives heading to China all have one thing in common these days: They don’t want U.S. dollars.

Hit by a free fall with no end in sight, the once mighty U.S. dollar is no longer just crashing on currency markets and making life more expensive for American tourists and business people abroad; its clout is evaporating worldwide as foreign businesses and individuals turn to other currencies.

Experts say the bleak U.S. economic forecast means it will take years for the greenback to recover its value and prestige.

Negative dollar sentiment is growing in nations where the dollar was historically accepted as equal or better than local currency - and dollar aversion is even extending to some quarters in the United States.

At the Taj Mahal, dollars were always legal tender, alongside rupees, for entry into the palace. But because of the falling value of the dollar, the government implemented a rupees-only policy a month ago. Indian merchants catering to tourists have also turned bearish on the dollar.

‘Gone are the days when we used to run after dollars, holding onto them for rainy days,’ said Vijay Narain, a tour operator in the city of Agra where the Taj Mahal is located. ‘Now we prefer the euro. It gives us more riches.’

In Bolivia, billboards feature George Washington’s image on a $1 bill alongside a bright pink 500 euro note, encouraging savers to turn to the euro to tuck away money earned abroad or sent home in remittances.

If the dollar’s going down … save it in Euros!!!’ say the signs popping up around La Paz for Bolivia’s Banco Bisa.” AP)