[TrevorW]

I think it was the Keating Govt that revalued the AUD$ prior to that it held parity with the US$.

Unfortunately the world needs to stop using the biggest economy/ biggest debt ridden country in the world as a benchmark.

My understanding of economics is that an a decline in the value of AUD$ has a two fold affect on our economy

1. Foreign investors are more likely to invest more in Australia because it's cheaper to do so and they can buy more of our raw products at lower prices, which has a flow on effect of increasing production which means stablising employment.

2. prices go up as the value of the Aust $ declines people locally stop buying and start saving thereby reducing inflation and reduce national debt as we import less.

Although the slump in the American market sees those same investors reducing investment and this has a flow on affect of slowing the American market which also sees a reduction in imports that cause countries like China to slow purchasing raw material as production slows etc etc etc.

Cheers