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Like Romeo And Juliet
We are separated by forces we cannot control. In R&J's case, a bunch of feuding idiots. In my case, I am separated from the boots I fell in love with at first sight -- red patent leather numbers with white stitching from Freelance Shoes -- by the fucking U.S. economy.


Freelance are normally not cheap, and I typically buy them in February, when the Paris sales are on. But...439 the extra 40 percent or so added by the saggy baggy U.S. dollar? Beyond obscene.

(And yes, I could get the 10 percent off with a discount card I have for Galeries Lafayette, where I saw them -- go to the Welcome desk and ask for one, for non-Paris-dwellers only. And then, I could get another 12 percent off for the detaxe at the border...but please...439 plus only 20 percent still sounds more like half a month's rent than the price of a pair of boots. Even for somebody like me, who typically only buys a couple of beautiful things a year, not piles of cheap crap, and keeps shoes and boots for eons, thanks to "Alex," the shoemaker on Main at Pico in Santa Monica.)

A Parisian friend texted me on my Paris mobile phone while I was riding home, dejected, on the Metro:

What boutique are you in right now and what are you buying?

I texted back:

I was in Galeries Lafayette where I learned how much the dollar is like the fifty cent piece...boohoo

All you economists and economist wanna-be's out there...who the hell is responsible for what's become of the dollar? Long list, please. Be precise. Name names.

P.S. Here's a little kick start on your name-naming from a piece in the W$J by Simon Kennedy and Lisa Twaronite:

The dollar marked a new record low against the euro Wednesday amid growing expectations that the Federal Reserve will cut U.S. interest rates next week and fears that the credit crunch is threatening the health of the U.S. economy.

The euro was up 0.5% against the greenback, at $1.3903, after earlier touching $1.3913 -- its highest level since the European currency was launched in January 1999.

The dollar has been in decline for the last several sessions amid a growing consensus that the central bank will cut its key federal funds rate, after the collapse of the subprime- mortgage market sent shockwaves through global credit markets.

Posted by aalkon at September 13, 2007 1:35 PM


In a nutshell: Massive federal deficits.

The level of debt has reached such a level that, outside the USA, there is a widespread expectation that the USA will default. If not directly, then indirectly, by deliberately devaluing the dollar.

Names? Which presidents, over the course of their presidencies presidency, added to the deficit. Not just a year or two, but in total? Lots, of course, but Bush, Reagan and Little-Bush are the three most recent offenders. Of course, this graphic is overly generous: Clinton would have been as bad as any, had he not been in office during an economic expansion.

I expect that the government is ecstatic to have a weak dollar. The devaluation is happening all by itself...

Posted by: bradley13 at September 13, 2007 4:49 AM

Not entirely. It's a small piece of it. Very small.

First thing to consider is that the Euro was created explicitly as competition to the dollar. And like all fiat currencies, it's value is set by, well, fiat. So no small part of the difference in value is related to the European Union's desire to have their currency appear more valuable to currency traders.

Next, the currency traders themselves. Some, like Soros like messing with currencies for fun. The so-called "asian crisis"? Soros' work.

The debt you should really be concerned with is investment-backed sub-prime mortgages. That's what's behind the latest decline. Something smells awfully ponzi about it, but I'm not sure why.

A weak dollar doesn't benefit anyone. And the USA defaulting on its obligations would be tantamount to an act of war, so don't look for that to happen.

Of course, some Paulite will come in here and tell us that if only the US was on the gold standard this wouldn't be happening. Of course it wouldn't - there'd be nothing worth trading for.

Posted by: brian at September 13, 2007 5:07 AM

As a midwesterner (ie, generally rather financially and otherwise sensible -- meaning I don't spend what I don't have), this drunken spending by our government mystifies me. I guess it's that it's been so easy for politicians to get away with up til now (Stevens' bridge to nowhere, etc). Also, I know Crid's not going to like this, and I'm aware of figures that mark the Iraq war as 5% of the budget, but 5% of money you don't have, and in such large sums, is a great deal of money. And then there are the lives lost. It seems we go into a lot of endeavors in our country with our pocketbooks wide open and facing downward.

P.S. Does anyone think we have a chance of beginning to pay for socialized medicine without taking a swan dive into the fiscal toilet?

Posted by: Amy Alkon at September 13, 2007 5:16 AM

"A weak dollar doesn't benefit anyone."

A weak dollar benefits foreigners who want to buy American goods and services, thus benefiting Americans who export, or cater to foreign tourists, etc.

The weak dollar put the boots out of Amy's reach, but a French person in America can now buy more with their stronger euro.

The US has been running such large trade deficits, that a weaker dollar is one result. So one cure would be for us to buy less overseas, and more from ourselves.

Posted by: doombuggy at September 13, 2007 5:39 AM

Amy - the end point of socialized medicine is the government getting to decide who lives, who dies, and who's born. Being able to say "I'm sorry Mr. Jones, but it's going to cost too much to cure your cancer, we're going to kill you instead" is part of the plan. Yeah, yeah, it's never happened, not directly. Through the selective denial of service, it will.

And the lives lost in Iraq are a drop in the bucket if we can actually stop the spread of militant political Islam. And I think if you ask a soldier, he'd tell you the same. Although you might take a more pessimistic approach, and think that stopping that spread is impossible, and we need a more English approach. But I've never been one for "an acceptable level of violence".

Posted by: brian at September 13, 2007 6:18 AM

"So one cure would be for us to buy less overseas, and more from ourselves."

...follow this link, if you dare, and you will definitely be motivated to buy on the slide show.

Posted by: Gretchen at September 13, 2007 6:37 AM

One of the reasons the dollar is down is less spending by us. The public spends less so companies cut back and have lay offs. Thus there are even less people with money to spend thus more cut backs and lay offs. A viscous cycle. I'd have to agree that the collapse of the sub-prime market had a huge part to play in it. Based on my first statement Amy should defiantly buy the shoes but only through an American distributer. Why you ask? Well that way the America distributer gets a cut of the profits thus dumping more money back into our economy.
"P.S. Does anyone think we have a chance of beginning to pay for socialized medicine without taking a swan dive into the fiscal toilet?"
Wait are you advocating for socialized medicine as in we should fix the dollar so we can have it?

Posted by: vlad at September 13, 2007 6:42 AM


The value of fiat money as a store of value depends on how much faith you have in the "full faith and credit" of the issuer. However, its value as a medium of exchange is set by market forces.



Posted by: phunctor at September 13, 2007 7:15 AM

vlad - you're quite wrong. Consumer spending is up, not down. And Amy, should she decide to buy those shoes, should buy them where she is, unless they are less expensive in the US (tax differences and so on).

phunctor - that is completely true. But who uses fiat money as a store of value? I mean, really. The reason that fiat money is useful at all is the fact that a capitalist system works on the movement of capital. Leaving dollars sitting around doesn't do anyone any good. Putting them in something that DOES have value (real estate, stocks, etc) is always better than leaving it under the sofa.

Posted by: brian at September 13, 2007 7:39 AM

Bah. This doesn't bode well for another trip to Paris next May.

Posted by: deja pseu at September 13, 2007 8:05 AM

> 5% of money you don't have, and
> in such large sums, is a great
> deal of money

True, true.

Posted by: Crid at September 13, 2007 8:09 AM

There are many reasons the dollar is down in relation to other currencies. A major one is the success of our economy. We have been so successful for so long that wages are higher than for most of the world. Therefore the rest of the world can export to us at lower prices than we can produce for ourselves, and we send huge amounts of wealth overseas, increasing the worldwide store of dollars and decreasing its relative value because of the huge supply of dollars. Also USA policy makers don't want a strong dollar because it would hurt out exports and put a lot of Americans out of work.

This does not explain the low dollar vis a vis the Euro, however. That is in part due to higher European interest rates and also to willingness of Euro officials to support the currency. They also depend less on exports to the rest of the world than USA does.

The fact that (boo-hoo) you think you can't afford those killer boots--they are cool, Amy--has mostly to do with the rest of the world joining the economic party we have had in the US for decades. Its the price you pay for the general worldwide welfare.

Posted by: David at September 13, 2007 11:53 AM

At least you can wear the pointy toe. Sigh.

There's a Freelance store in Montreal -- maybe they'll ship? We're not doing great against the Canadian dollar either, but at least it's 1-to-1, not 2-to-1.

Posted by: Jessica at September 13, 2007 12:14 PM

This is the point at which being an independent and thinking woman might be working against you, dear Amy.

Promise to walk on Gregg with those and he'll get them for you.

Well, he should...

Posted by: Radwaste at September 13, 2007 2:49 PM

And the lives lost in Iraq are a drop in the bucket if we can actually stop the spread of militant political Islam. And I think if you ask a soldier, he'd tell you the same.

Soldiers write me all the time, as my column runs in Stars & Stripes, and there are many who express anger at our being at war in Iraq.

Does anyone here think our foray into Iraq has stopped the spread of militant Islam? Gregg's asleep now, but I believe his analogy (about toppling Saddam) when I asked him this question today -- ie, "What person can truly that invading Iraq hasn't been a really bad idea?" -- he said, "You don't kill the cat as a way of getting rid of the mice."

As for the boots, my friend Chantal told me to figure out my size, and she'll hop over and buy them for me the first day of the clearance sales in January, if they're still there. Tragically, if they are, I'll have to pay her back when I come back in February!

Posted by: Amy Alkon at September 13, 2007 3:38 PM

Amy! I thought you were a libertarian! Milton Friedman said anything can be money -- it's all in how the parties value the exchange. So go back to Galeries Lafayette, find the manager and offer him 200 Euros plus a mutually agreed-upon term of free advice.

Failing that, you could always pitch him a blowjob. I understand the French are very fond of those.

Posted by: Nance at September 13, 2007 3:42 PM

At least you can wear the pointy toe. Sigh.There's a Freelance store in Montreal -- maybe they'll ship? We're not doing great against the Canadian dollar either, but at least it's 1-to-1, not 2-to-1.

Merci, Jessica. A good thought.

And P.S. I find, with good shoes, you're paying for comfort, too. Freelance are great because they're deceptively high. They're actually extraordinarily comfortable and last for years. You just have to make sure the shoemaker doesn't cover up the little (actually) embroidered rose on the bottom when he resoles them.

I'm guessing, actually, that I pay less for my shoes and boots than a lot of people because I never buy cheap shoes. Of course, I typically get non-cheap shoes on sale or at a discounter!

Posted by: Amy Alkon at September 13, 2007 3:43 PM

Hi Nance...we just got back from a Gallery opening for Vincent Gagliostro (a guy I know here) with fellow Detroiter Sue Rynski.

As for your comment: I'm guessing Uncle Milton never shopped at Galeries Lafayette.

As for the offer of a blow job, I think the guys working in the G.L. ladies shoe department probably like blow jobs from other men. Also, I don't think that would go over real well with Gregg!

Posted by: Amy Alkon at September 13, 2007 3:48 PM

just a question, though unfortunately not entirely related to the economy:

Do you really think we can fight militant political islam by beating them down with weapons? I mean, I understand most everybody's differing opinions and evidence and what not, but when it comes down to it, your fight a people's spirituality. Wether or not their beliefs are warranted is irrelevant. It's a big part of their lives nonetheless. Killing them on their own soil and keeping a constant military presence isn't going to knock down the pillar of faith so fervently in love with the afterlife, is it? they're just going to keep fighting as more and more join their ranks because they see what they're doing as right.

is fighitng a hot war the way to go?

Posted by: Scott at September 13, 2007 6:10 PM

As far as the weak dollar, I think it's pretty much due to massive debt financing everywhere in the U.S. Government, individuals, the whole lot. The dollar isn't backed by anything but people's faith in our economy, so it ebbs and flows with the world's confidence in it. Brian's got a good point about the collapse of the new clever little mortgage-backed securities that are really hurting the economy right now by creating a credit crunch. But the fact remains, it's the ridiculous deficits we're running nationwide that are the problem. I don't think the pain is anywhere near over, either. Sorry to say Amy, but I don't think sweet European-made boots are going to get cheaper any time soon. Good thing you've got discount fashion-shopping skills.

Posted by: justin case at September 13, 2007 7:22 PM

Amy - the only problem I have with the Iraq war is that we were not nearly vicious enough. Same thing with Afghanistan. Too worried about how a given move is going to play out in the press at home. We broke Saddam's back alright. But by failing to secure the border, and then following that up with absolutely no response to repeated invasions by Iran and Syria, and then allowing Sadr to continue to suck oxygen, and not responding to Fallujah, etc...

If not us, who?

Scott - There is only one way to defeat political Islam - it must be exterminated. They have but one non-negotiable demand - that everyone that is not them die. There is literally nothing we could do (or, indeed could have done over the part 100 years) that would have prevented this.

Well, except maybe if we'd crushed the Islamist movement in its infancy, but then again, we weren't paying a whole lot of attention to Egypt when the Muslim Brotherhood was founded.

And when we fuck up in Iraq by being too gentle, we lose momentum. And if we fail to destroy the Islamist movement in the middle east, it WILL come back here, and it will kill more Americans.

If it helps, think of the Islamist movement as the Terminator - "Listen. And understand. That terminator is out there. It can't be bargained with. It can't be reasoned with. It doesn't feel pity, or remorse, or fear. And it absolutely will not stop, ever, until you are dead."

Posted by: brian at September 13, 2007 8:22 PM

The dollar has been weakened mostly by the increasing homosexualization of American culture.

Posted by: Lena Cuisina, Wannabe Economist at September 13, 2007 10:09 PM

Just because they last for years doens't mean you should wear them for years. Red ankle boots? I think you can find a facsimile for less.

Posted by: Kate at September 13, 2007 10:32 PM

the only problem I have with the Iraq war is that we were not nearly vicious enough.

I agree. While the principles of democracy are contrary to Islam, and being there is not going to be fruitful for us in creating a democracy which doesn't have the proper ground to take root, if we were going to invade and conquer, we should have not pussied around about it -- as we did.

We stuck our military toe in the water in Iraq and kind of swished it around instead of bringing down real military might on them. Again, I'm not for going into Iraq, but if you're going to go in, go in!

Now, back to more superficial topics, Kate, Freelance are truly comfortable (I don't wear uncomfortable shoes or boots) and perhaps you can't tell from the photo, but they're truly fab. The patent leather isn't too shiny, the stitching is just right and makes them something special. Life is too short to wear unspecial clothes. Typically, I get a lot of clothes for a song on eBay, but I'll buy a few beautiful things: A jacket or sweater at Ralph Kemp, my favorite young Paris designer. Or a boiled cashmere Donna Karan sweater/shawl at Loehmann's. I probably spend vastly less than the average women on clothes every year. This year, up till now, I'd be shocked if my total clothing purchases added up to more than $200. (Bought the Donna Karan thingamajig last year, and I get vintage jackets on eBay for about $19.99.)

Posted by: Amy Alkon at September 14, 2007 1:16 AM

And I left out the shape of Freelance boots, which doesn't compare to most clompy American ones or even a lot of French or Italian boots.

Perhaps for some, it's no big deal to look sloppy and wear unfab clothes, but I truly don't feel myself -- experienced recently when Air France lost my luggage for five days -- if I'm not wearing something slinky, girly, and fab.

Posted by: Amy Alkon at September 14, 2007 1:27 AM

And P.S. I find, with good shoes, you're paying for comfort, too. Freelance are great because they're deceptively high. They're actually extraordinarily comfortable and last for years.

The Manolo argues similarly, in defense of the lovely, well-crafted shoes. Unfortunately I have somewhat oddly shaped feet (left foot 9.5WW, right foot 9W is my estimation) and a lot of the high-end shoes don't come in sufficiently wide widths. I had an ongoing romance with a pair of Prada heels at my local DSW that finally ended, the third time I tried them on, on the advice of my feet.

Soon as the dollar strengthens again I'm heading to Alberta Boot -- their cowboy boots look gorgeous, and for an extra C$60 you can send them a tracing of your foot and they'll custom-make the boot, which is exactly what I need.

Posted by: Jessica at September 14, 2007 6:16 AM

Oh la la. And, last year, I did buy some faboo cowboy boots for 99 eu right off rue d'Alesia, where I meet my friend Mark for lunch on Fridays at Bouquet d'Alesia. Of course, they aren't the real deal, as they have a zipper...quel horreur! (For the Texas purists.)

Posted by: Amy Alkon at September 14, 2007 6:38 AM

> Too worried about how a
> given move is going to
> play out in the press
> at home.

Who exactly are the people we should have killed but didn't? Which ones, Brian? Amy? We're going need names and addresses here.

Posted by: Crid at September 14, 2007 11:27 AM

Crid - we could have started with Sadr. As soon as he poked his fat face up, we should have blown it off. After Iran started interfering, we should have hit Tehran. Maybe it would be sufficient to kill Ahmadinejad. Maybe we'd have to take out the entire Supreme Council. Once it was proven that Syria was aiding and abetting smuggling operations, Assad should have been offed. Maybe blow up the palace in Damascus. Killing Hugo Chavez would have been a good idea until Falwell opened his fat mouth.

Sorry, I don't have their addresses, but I'm willing to bet the Marines do.

But, if we did any of those things, the New York Slimes would have been all over Bush for being a "cowboy", and the Grauniad would have been talking about American Empire.

Posted by: brian at September 14, 2007 4:06 PM

We're going need names and addresses here.

Even more. It's 1:30 am over here, so I hope somebody more awake than I am will come up with them.

Posted by: Amy Alkon at September 14, 2007 4:30 PM

Tehran has 8 million people in it. Did you want them all dead?

This is a weird time for you two to be asking more indiscriminate killing.

Posted by: Crid at September 14, 2007 4:44 PM

Me? Why would it be weird? I've got no problem with indiscriminate killing. I'm only against it if the end result will have a negative impact on me. so, while I was for the carpet-nuking of the middle east on 9/12/2001, after consideration I've concluded that the long-term side effects of that are so bad as to be an unacceptable trade.

But taking out the political infrastructure in Tehran would not necessarily be a bad thing, and wouldn't require nukes. The only real issue with attacking Iran is the insanely perverse reaction it would likely create in the minds of the Iranian people. Right now, the majority of the people can't stand the government, but can't do anything about it. If we attack that government, the cognitive dissonance that results will make those people rally behind the government they hate.

I never claimed to have all the answers. Hell, I never claimed to have SOME answers. But it's quite obvious that "realism" and pacification haven't worked. It's time for something radical.

Posted by: brian at September 14, 2007 6:21 PM

Were you breastfed?

Oh, no reason in particular... Just curious...

Posted by: Crid at September 15, 2007 3:21 AM

Were you breastfed?

Crid, it's remarks like this that make me want to reach across the ocean and the rest and give you a big wet hug.

Posted by: Amy Alkon at September 15, 2007 4:48 AM

Bring some o'dat fromage! It was pretty snarky, but how much more "radical" a change in our approach could there have been? Bush 41 was all about the CIA and UN coalitions. Bush 43 was about something a lot more direct... And --I want badly to believe-- more honorable.

It's fun to write this (try it sometime!): Dubya represents the best and most meaningful expression of the Boomer generation's counter-cultural enthusiasms. (Clinton, more of a rock n' roll guy by nature, will be remembered for soiling the officewear of his young interns.) If all that music and protesting ever amounted to anything in adult life, this is it.

Brian, the problem isn't that no one's ever thought of just killing anyone who might possibly be an enemy. The problem is that it's abjectly immoral, unworkable as a practical matter, and would leave us open to (righteous) pre-emptive attack from every other nation on Earth including Cameroon and Uruguay.

As noted in a nearby thread, the American voters aren't skittish peaceniks; they re-elected Bush. The problem isn't that we lack means or resolve, the problem is that violence doesn't seem to be getting the job done. And for the rest of our lives, Ty & Renee might be wondering if it was worth it to try.

At this hour, the best reason to think it was is that it was indisputably going to be a shitty circumstance over there anyway. I hope they find that to be some consolation.

Posted by: Crid at September 15, 2007 10:03 AM

I'm so glad I took Economics in university! I got me some Macroeconomic book learnin'. Unfortunately none of it stayed in my brain, so that whole monetary fluctuations stuff sounds vaguely familiar...

Posted by: Chrissy at September 15, 2007 4:24 PM

P.S. The Canadian dollar is nearly at par. I think it was .96 last time I looked, so going to Montreal for the boots won't save all that much-you should probably phone ahead for the price.

Posted by: Chrissy at September 15, 2007 4:27 PM

On the currency thing - When I was in Sweden, I noticed that electronics were far more expensive. Simple electronic toys like a Nintendo Game Boy Micro, which sells for $99 here, and an equivalent number of Yen in Japan (it's actually manufactured in China for Nintendo of Japan) was going for an equivalent of $149 in Swedish Crowns. That's a 50% markup. And that was BEFORE VAT. And I see the same thing with new systems. The XBox 360 here is US $349, and in the UK (amazon) its 249 quid. It's literally the same piece of hardware with a different set of regulatory stickers, and different firmware. But it's $700 at todays conversion rate. No wonder the manufacturers want to block importers who bring games and consoles over from the US.

So I expect there's more than a mere currency conversion thing that's impacting prices, Amy. You can probably get those same boots at a boutique in Manhattan for 20% less than the (converted) Paris price. And only pay 7% sales tax at the same time.

Posted by: brian at September 16, 2007 6:20 AM

If you're serious about understanding the Euro-dollar exchange rate differential, search at for a thorough analysis. If you want the short answer, it's interest rate differentials. More specifically it's the expectation of future interest rate differentials.

Our economy is growing faster than Europe's, and the gap is growing, not shrinking. The deficit is not out of line as a percentage of the total economy, and it is shrinking.

Posted by: MarkD at September 17, 2007 8:27 AM

Thanks, Mark. I'll read there after my deadline.

Posted by: Amy Alkon at September 17, 2007 9:14 AM

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