www.smartdivas.com

The US dollar is hurting; that is not news to anyone.  The dollar was one of the hardiest currencies of the 20th century, but the 21st century has brought a different fate altogether to the US dollar.  The dollar has seen a steady and unfortunate decline for quite some time, based on current events in America and in the rest of the world.  As the currency has declined, so has the economy, and the economy has been affected by a multitude of other factors as well. 

The Japanese Yen has done quite well for itself in the world of world currencies.  Just like the dollar, the yen has long been known to be one of the stronger world currencies.  However, the yen has been grossly affected by the advent of the Euro, just the same as the US dollar has been affected.  For both the dollar and the yen, the Euro has not been a good addition to the world market of currencies.  The Euro has done extremely well for itself, but it has knocked down these other two world currencies on its rise to the top.

About the only currency vying with the Euro for prominence is the Great Britain Pound; this currency has continued to be extremely strong despite the Euro.  A lot of Europeans criticized the British for not joining the Euro countries in their financial endeavor, but Great Britain’s choice to not give up their currency has turned out to be an extremely wise one.  The pound is a formidable currency on the world market–as is the Euro.

The yen and the dollar do not share such a brilliant prognosis.  Both currencies have been steadily declining though to read some articles one would think that the dollar is the currency disaster of the moment.  To read another article, the yen seems to be the currency disaster of the times.  The bottom line is that both currencies are doing poorly lately and seem to still be on a downward slope.  The reason that their ill fate catches so much attention in the media is that they were once both powerhouse currencies.  The true tragedy is to be a real success story and then see a miserable decline; this makes the decline that much more memorable for the media, and somehow the rest of the world seems to like to laugh at the misfortune of a once rich currency that suddenly takes a downward spiral.

Some online reading suggests that there is no reason for the demise of the Japanese yen.  On the other hand, there are always numerous reasons cited for the downward slope of the US dollar.  Starting with 9/11 and the economic fall-out, as well as the general, nation-wide, type of depression in a financial sense as well as a general outlook sense, the reasons for the decline of the US dollar are many.

It’s partially because of this fate of the US dollar that the yen has seen recent falls.  Of course, the yen is not inextricably linked to the dollar, but the connection is not a negligible one either.  On the Forex market, the yen must first be traded with the dollar before it can be traded with the Euro; trading the yen for the Euro is not actually a possibility, so the link between the yen and the dollar becomes a little clearer.  The link between the yen and the Euro is only a secondary link, by way of the dollar.

The bottom line is that the dollar and the yen are both on the decline, and have been for quite some time.  No upward change lies on the immediate horizon either.