MAGA by destroying the dollar is bad for the average U.S. investor

Opinion: Making America great again by destroying the dollar is bad for the average U.S. investor

https://www.marketwatch.com/story/making-america-great-again-by-destroying-the-dollar-is-bad-for-the-average-american-investor-2018-01-25?mod=cx_politics&cx_navSource=cx_politics&cx_tag=other&cx_artPos=5#cxrecs_s


Published: Jan 26, 2018 7:54 a.m. ET





Stocks will rise in the short term, but investors will be worse off in the long term
Bloomberg News
Treasury Secretary Steven Mnuchin and his wife Louise Linton with an uncut sheet of $1 dollar bills.

By Nigam Arora Analyst

No politician in the United States wants Americans to be worse off and deliberately take steps that are bad for an average American investor.

However the policy of destroying the dollar, though well-intentioned, will lead to American investors being worse off in the long term.

In the short term, investors are celebrating a lower dollar. But it is also prudent to start thinking of defensive steps to preserve wealth.

The dollar fell to a three-year low after comments by the Treasury Secretary Mnuchin on Wednesday in support of a weaker dollar. It was the biggest one-day fall in 10 months. Before his inauguration, President Trump declared that the dollar was too strong. This started the decline in the dollar. But Mnuchin’s comment is like drilling a hole in a dam that is holding back a flood. Initially after the hole is drilled, only a small amount of water flows out. But if the hole is not repaired or more holes are drilled, pretty soon the dam loses its structural integrity and causes a flood. In this case if the flood happens, it will be average investors losing money in the stock market, like they did in 2008 and 2000.

I am politically agnostic. My sole focus is to help investors.