WHEN CHEAP DOLLARS HELP U.S. EXPORTERS, AND WHEN THEY DON'T
There's no doubt that the dollar drop has a bright side for some U.S. exporters, and a low dollar may increase exports ("The buck stops where?," International Business, Sept. 7). True--as long as it's stable and reflects the true value of a currency. An undervalued and highly fluctuating dollar, as we have had in the past two years, just creates confusion and is not a healthy base for the export of U.S. products.
Many European managers would like to do business with U.S. companies, but a stable dollar, even at a higher level, would be much more desirable to companies in Europe than this fluctuating dollar, which makes it hard to plan even six months ahead.
I've seen many promising projects and sound business efforts of American businessmen being jeopardized by high fluctuations in the exchange rate of the dollar to major European currencies. How can one possibly plan to use U.S.-made parts on a large scale in product to be rolled out in a year or so if there's the chance that all of a sudden, these parts may be easily 20% more expensive than planned on today?