dys, Good observation; to peggy-back on the exchange rate of the US dollar against the English pound, there is also the issue of per capita income in both countries. Seen from "that" perspective, it doesn't make much sense, except from the standpoint of too much dollars floating around in this world without much to back it up.
This is a graph that shows the trend in real wages in the US.
This is a graph that shows our debt load.
And finally the trend in the exchange rate of the US dollar.
With higher energy costs, we're going to see this trend continue, because Americans are spending more and saving less, our purchase of imported goods will rise (exchange rate disadvantage), and our GDP will suffer as we continue to buy with ever cheaper dollars from future earnings.
The talk of recession will become more common in the pundit's vocabulary as the months trend towards 2008.