Inflation is lower and more stable and the real business cycle fluctuations are more modest.

We are particularly poor at the open economy issues.

Even if the dollar does decline during the coming months, the delays in the response of exports and imports to the more competitive dollar will mean that the increase in aggregate demand from this source may not happen for a year or more.

Domestic inflation reflects domestic monetary policy.

We pay some price when necessary to bring down inflation but that price is temporary and is not large relative to the permanent gain from reduced inflation.

After all, an overvalued dollar gives us the ability to buy foreign goods at lower prices. And the existing volume of exports brings more yen and euros than they would if the dollar were more competitive.

But then in April of 1985 the dollar began a sharp decline. The dollar's trade weighted value fell 23 percent in just 12 months and by a total of 37 percent by the beginning of 1988.

I think that over the last few decades, we have seen better economic outcomes than in the past.

Although economists have studied the sensitivity of import and export volumes to changes in the exchange rate, there is still much uncertainty about just how much the dollar must change to bring about any given reduction in our trade deficit.

First, I think the science of monetary economics has clearly gotten better.

But the primary reason for wanting the dollar to become more competitive in the near future is that we may need an increase in exports this year and in 2007 to sustain the economy's current pace of expansion.

The more competitive value of the dollar turned around the trade deficit.

Increased government spending can provide a temporary stimulus to demand and output but in the longer run higher levels of government spending crowd out private investment or require higher taxes that weaken growth by reducing incentives to save, invest, innovate, and work.

A second reason why science cannot replace judgement is the behavior of financial markets.

But because we in the United States finance our current account deficit by borrowing in our own currency, we can move to a more competitive dollar without the adverse effects that followed currency declines in other countries.

The price of imported oil in the US doubled between summer 2003 and summer 2005, reducing consumers' purchasing power by more than 1 per cent of gross domestic product.

The good news is that a competitive dollar in the global market and a strong dollar at home are compatible in both the long run and during the transition to a more competitive dollar.

A rise in the level of saving can reduce aggregate activity temporarily but only a sustained high level of saving makes it possible to have the sustained high level of business investment that contributes to the long-run growth of output.

Homeowners who refinanced their mortgages took out cash and reduced their monthly payments at the same time. Much of the cash obtained by refinancing was spent on consumer durables, home improvements and the like.

And finally, no matter how good the science gets, there are problems that inevitably depend on judgement, on art, on a feel for financial markets.

An increase in the relative price of products from the low wage manufacturers in Asia and Latin America will also make those products less attractive to American consumers.

Thirty years ago, many economists argued that inflation was a kind of minor inconvenience and that the cost of reducing inflation was too high a price to pay. No one would make those arguments today.

To finance this trade deficit, the U.S. has to borrow from the rest of the world or sell American assets like stocks, businesses, and real estate to the rest of the world.

The only way that we can reduce our financial dependence on the inflow of funds from the rest of the world is to reduce our trade deficit.

Unless the trade deficit shrinks, the combination of the trade deficit and the interest and dividend payments to foreigners will grow ever more rapidly.

My theme this evening is that America needs a competitive dollar.

In short, both experience and economic theory imply that the US could now t to a more competitive dollar without experiencing either increased inflation or decreased economic growth.

So just as I want pilots on the planes that I fly, when it comes to monetary policy, I want to think that there is someone with sound judgement at the controls.

Inflation is lower and more stable and the real business cycle fluctuations are more modest.

If the Federal Reserve pursues a strong dollar at home while the dollar becomes more competitive in global markets, we can achieve both price stability and a more balanced path of economic growth.

Natural resources are so vast that no single individual or business is going to protect them; they don't have an incentive to.

The bronze powder business, however, no longer required my personal attention, and was well managed by those I had chosen as the guardians of a secret, which was long and honourably kept.

I have done things politically, and I've been running a business at the same time, but I sort of joke that to some extent I do more than most legislators have done in their whole careers, and I've been doing it as a part-time job.

Howard Hughes himself was a regular at the restaurant, and in a way it became his headquarters, too. Howard had recently relocated to Las Vegas, so when he wanted to do business in Los Angeles, he went into the back of our restaurant to use the telephone.

Prosperous farmers mean more employment, more prosperity for the workers and the business men of every industrial area in the whole country.

My parents were amazing people who had no business being together - and they knew it.

We mean by "politics" the people's business - the most important business there is.

Slovakia's joining the OECD in 1999 is totally dependent on meeting economic reforms required such as transparency and legislation that permits fair and open conduct of trade and business.

The way the business things work in Russia is you have to meet people, you have to go through a certain amount of etiquette and business things are done just simply by a shake of the hand and whether they like you or not.

I make no claim to being a business genius. You can make so much money in this business that it loses its value.

It costs a great deal of money to do a musical, and the more money involved, the more big business influences the artform.

It's a very hard and competitive business in which you have to fight every day in order to impose yourself.

I know the history of the record business so well because I followed Billie Holiday into the record studios. It was so primitive compared to the sophisticated business today.

Chicago kept industry, attracted new business, became the center for convention trade and transportation.

I have been, and will go on, fighting that damnable, dirty, rotten business with all the power at my command.

All business success rests on something labeled a sale, which at least momentarily weds company and customer.

I knew an actor's career goes up and down and back up again. Your standing in this business can't be your whole identity; otherwise, you're doomed.

The surest way to return to the people's business is to listen to the people themselves: We need to drop this whole scheme of federally controlled health care, start over, and work together on real reforms at the state level that will contain costs and won't leave America trillions of dollars deeper in debt.

Again, I say I will be glad to tell what songs I have ever sung, because singing is my business.