While the American Economy struggles to regain its footing following the massive recession and credit crisis, the Fed seems to have their own agenda.
Economists on Capitol hill have been expressing growing concerns over the budding economy. One famous economist is even predicting a crash worse than that of The Great Depression. One of the major concerns is the low interest rates the Fed has established in an attempt to help regrow the economy. Higher interest rates equal a higher level of confidence in the economy which will then give investors on Wall Street the confidence to invest. Which as we all know means a stronger economy.
However, another threat to the economy comes in a surprising form: a strong U.S. dollar.
Should the dollar regain its superiority to all other currencies, it will make it harder for mega US companies such as IBM, Boeing, and General Electric to trade with overseas clients due to the increase in costs thus lowering their profits. Because these companies make the bulk of their profits by overseas trading, the CEO's of these and other business giants are beginning to take steps along with the Fed to keep this from happening.
Anonymous insiders from both the Fed and General Electric have stated that communications between the Fed and mega companies' CEOs have been happening for about a month now, perhaps longer, to keep the worth of the U.S. greenback low in order for the companies to not lose profits. The Fed is willing to maintain the low worth of the dollar due to the influence the companies have on the overall American economy as well as some incentives provided to Fed executives by the CEOs. While exactly what these incentives are is unknown, they seem to be working as a report issued by CNN shows that many economists fear the Fed is waiting to long to increase interest rates, which would in turn strengthen the economy, and eventually the dollar. In this report, two of the six major threats to the American economy is the Fed, and the dollar's increase in value.