Can someone explain to me (in layman’s terms) why the dollar is strengthening?

Don’t get me wrong, my company imports, so a strong dollar is GOOD for us. But, with all the excess liquidity and very low interest rates, wouldn’t supply & demand theories show a depreciating dollar (inflation)? I just don’t see what, on the demand side, could offset the amount of cash floating around.

This is like an auctioneer handing out $500k to each participant before the auction begins… We know that with an excess supply of cash, the bidding will quickly escalate and the $1,000 item will sell for 10,000. Yet, what’s happening with the value of the dollar, it would be like that $1000 item now selling for $700. I just don’t get it.

- fedup4

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