The dollar dives, can the economy be far behind?

Thanks to the totally irresponsible fiscal, energy and foreign policy of the Bush administration the dollar and the US economy are in trouble.
Stocks Drop as Oil Surges, Dollar Slides

U.S. stocks sank on Tuesday as oil prices jumped above $51 a barrel and the dollar slid on concerns that other central banks would follow South Korea's lead in diversifying reserves out of U.S. assets.

The Left Coaster is on top of this story so I'll just direct you over there.
The Falling Dollar, Inflation, and Oil

The world is thus awash in dollars, and excess supply means falling value. Economics dictates a gravity toward balancing a trade imbalance by reducing the value of the currency of the country in deficit (the U.S.), making U.S. exports cheaper and foreign imports more expensive. A drop in currency value has the benefit in that it supports the manufacturing sector, which is why China and Japan in particular have been buying dollars to support their own manufacturers.

So what's the problem? As imports get more expensive, imported goods cost more, which means inflation. Our dollars won't buy as much as they used to, so we all feel poorer. Interest rates rise as the Federal Reserve combats inflation. People with adjustable rate mortgages pay more and feel poorer. The housing market (including home construction) slows as fewer people can afford a new mortgage. Between inflation and high interest rates, that means less buying power, which means less consumption and a weaker economy. more

In Oil's Sell That Spends Well pessimist tells us how the threats against Iran and Venezuelan President Hugo Chavez play into all of this.
George W. Bush may have found his legacy, he brought the once mighty United States to it's knees all by himself. And to think, his daddy told him he would never amount to anything.