Eamon Javers of Politico reports: On Tuesday, Matt Drudge ran a headline about the weakening U.S. dollar on his website, Drudgereport.com. In and of itself, that would be unremarkable, except that it was the 18th time Drudge had posted a link to a story about the weak dollar this month.
And October was only 20 days old.
Clearly, Matt Drudge has developed a fascination with the declining U.S. dollar.
“He’s fixated on it,” said Tom Rosenstiel, director of the Pew Research Center’s Project for Excellence in Journalism. “There’s no question that Drudge can alter what people are paying attention to.”
Market watchers say it’s unlikely that Drudge is actually moving the currency markets with his relentless attention.
“I don’t think that anyone who seriously trades currencies reads The Drudge Report before making important buy or sell decisions,” said Chris Roush, a professor of business journalism at the University of North Carolina at Chapel Hill.
But Drudge does have the ability to put news items on the radar screen of major media outlets and political figures in Washington. And other people are paying attention to Drudge, too: A source close to the U.S. national security community said that Drudge’s link to a story in the [London] Independent earlier this month instantly grabbed the attention of senior American officials.
The story raised the prospect that foreign governments were in talks to replace the U.S. dollar as the default currency for oil trading. Any kind of coordinated attack on the value of the dollar could be seen as a national security threat, and defense and intelligence officials were curious about the source of the anti-dollar rumors that day.
On Tuesday, Drudge spotlighted a one-paragraph item from the Agence France-Presse news service titled “We are ‘worried’ about weak dollar: Eurogroup chief.”
That same day, the dollar hit a new 14-month low against the euro, with the continental currency trading as high as $1.4994 against the dollar. That represented a continuation of the greenback’s steady slide this year: The euro traded at $1.25 against the dollar as recently as March.
Drudge’s interest in the brutal year for the buck is intensifying. According to a search of the website DrudgeReportArchives.com, which is not affiliated with Drudge himself, the Internet pioneer has already posted more stories on the dollar in October than he did the month before, when he posted links to 13 stories about the currency.
“There’s definitely an appetite from a fairly large number of people for these kinds of stories,” said former Bush Treasury and White House spokesman Tony Fratto, who is now a CNBC contributor. “People are looking for cheat sheets for how the economy is doing, and they look to the Dow, the unemployment number and now the value of the dollar.”
Many economists say one reason for the slumping dollar is the strengthening global economy. In the darkest days of the financial collapse last year, investors flocked to the dollar – largely because it is seen as a safe, if low-return, investment in troubled times.
What’s more, there’s one economic upside to a soft dollar: increased exports for U.S. manufacturers. Reporter Nelson Schwartz noted in an article in The New York Times on Sunday: “A weak dollar could prove beneficial to the American economy by aiding long-suffering manufacturers, rebuilding a stronger industrial base and lifting exports even if it makes life harder for trading partners around the world, especially in Europe.”
But that Times article, titled “In Dollar’s Fall, Upside for U.S. Exports,” did not receive a link from Drudge.
Drudge also has tried to tie President Barack Obama to the dollar’s plunge. “Obama Dollar Retreats Most Against Commodities in Wealth Shift,” noted Drudge’s link to a Bloomberg story Oct. 13. “Obama Under Fire Over Dollar,” he headlined Oct. 7, linking to a story in the Financial Times.
That’s leading some to conclude that Drudge’s conservative politics are playing a part in his focus on the issue.
“I think Drudge has been taking a page out of Fox News’ playbook,” said Adam Penenberg, a journalism professor at New York University and author of “Viral Loop: From Facebook to Twitter, How Today’s Smartest Businesses Grow Themselves.”
“Because Republicans have been making hay over their belief that America is becoming weak, its “socialist” economy in shambles, stories on the falling dollar help buttress this worldview,” Penenberg said.
One financial consultant who asked not to be named agreed with that analysis. “The problem is now that fundamentals-driven dollar weakness is being politicized as an anti-Obama weapon, thus Drudge,” said the consultant. “Drudge is simply looking at the charts and then hitting the administration on it.”
Other conservatives have been interested in the decline of the dollar as well this month. On Oct. 6, former Alaska Gov. Sarah Palin posted an item on her Facebook page reacting to the reports of an anti-dollar effort in the oil markets.
“Even the possibility of such a talk weakens the dollar and renews fears about its continued viability as an international reserve currency,” Palin wrote. “In fact, today a United Nations official called for a new global reserve currency to replace the dollar and end our ‘privilege’ to run up huge deficits.”
Palin laid the blame for the weak dollar squarely on the Obama administration: “All of this is a result of our out-of-control debt,” she wrote. “This is why we need to rein in spending.”
Traditionally, the dollar is a topic that politicians shy away from, since too-casually worded comments by officeholders can accidentally tank the currency markets. But that’s been changing in recent months as the decline of the dollar has mirrored larger concerns about the state of the U.S. economy and America’s place in the post-crash financial world order.
{Politico/Matzav.com Newscenter}
