There is something weirdly appropriate about the fact that it took a supermodel and not an economist to draw attention to the plight of the U.S. dollar. Reports that Brazilian supermodel Gisele Bundchen allegedly refused to be paid in greenbacks and insisted on euros had markets aflutter and highlighted the dollar's plunging value and its potential consequences.
In recent weeks, the dollar has hit new lows against most currencies. The U.S. currency reached $2.10 against the pound, its weakest against the British currency since 1981, and scrapped to $1.47 against the euro, a new record against a currency that was established eight years ago.
The dollar has dropped against all 16 of the most actively traded currencies this year: It has lost 10 percent against the euro, 6.9 percent against the pound and 5.2 percent against the yen. It reached its lowest value vs. the Canadian dollar since 1950, when the fixed exchange rate ended, and hit a 23-year low against the Australian dollar. The U.S. Federal Reserve reckons that the dollar has weakened 8 percent against a basket of currencies from major trading partners since January 2006.