Consequences of living in and on a bubble: Your money just isn't worth the same anymore.



For the first time in thirty years, the U.S. Dollar sank below the value of the Canadian Dollar. The Canadian Dollar isn't “funny money” anymore, and at the rate things are heading, that deliniation will soon be reserved for the U.S. dollar in short order. Against the Euro, the Dollar continues to set record low after record low. It is only a matter of time before a slew of records begin against the British Pound. Just how did we get here?

On September 18, the Federal Reserve led by Ben Bernanke did something it does not often do – it moved the federal funds rate, the rate at which banks can loan money to each other, down by half a percent in order to stave off a perceived financial crisis. On the face of it it seems like a good thing for Americans: lower borrowing rates means the rates on variable loans comes down which means people can borrow more which means that good old economy will heat right back up and everything will be fine once more!