The latest foreign currency to tumble, the Australian dollar, is a further indication that global export activity is becoming an ever fiercer international battleground.
As the U.S. dollar gains strength, due to surging foreign U.S. bound investments, and an improving domestic economy, America’s vaunted world export leadership may be in for its fiercest competition in more than a decade. Under such circumstances, it’s doubtful that the U.S. will be able to maintain the blistering export pace of the past two years, setting a 2012 record surpassing the $2 trillion mark.
However, there may be enough good news on the “outward bound” energy front to overcome the “headwinds” of increasing competition that U.S. products will be facing more aggressively in the foreseeable future. The major breakthrough of Administration approval for unlimited liquid natural gas is a strong first step in that direction.
This is a significant departure from President Obama’s previous position of favoring the Environmental Protection Agency’s strangulating regulations to curb “fracking,” which has opened the natural gas floodgates in its cross hairs. This 180 degree turnaround may signal a much greater opening in the speedup of oil, as well as natural gas production in the immediate future. Approval of the XL oil pipeline, to facilitate Canadian tar sands-converted oil directly to Gulf of Mexico-located refineries could be an unexpected step in that direction.
This White House turnabout is all about billions of dollars in additional revenues, plus thousands of new jobs. With the general U.S. economy is poking along at a 2.5%, or less growth pace, such a welcome econo/employment bonanza could not be resisted. This is especially true of a President currently harassed with a preponderance of non-economic and foreign policy issues, together with a need to burnish a legacy that is now hanging in the balance.