November 26, 2004

The Dollar and the Euro

Howard over at Oraculations makes a very interesting comment about the current imbalance between the Euro and the Dollar. Howard takes the short term view —and— the long term view and we come out nicely ahead.

The falling dollar, the real silver lining: The French and the rest of the EU are subsidizing production of the Airbus and they have successfully “underbid” Boeing. But have they? Airlines are buying the Airbus with wildly over valued Euros and are going to be on the hook big time when the dollar eventually turns. The EU is paid in Euros that are deflated.

This is what is behind their attempts to force us to tax the same way they do. Boeing has lost for now, but the real losers will be the airlines who buy the Airbus and the countries who will have to foot a huge deficit. I'm willing to bet that Boeing goes into aftermarket manufacture of Airbus parts that will be much cheaper than the EU parts.

Stay tuned.

Heh…

Posted by DaveH at November 26, 2004 09:13 PM
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