Thom Hartman has conducted an excellent interview with Randall Wray. In part, the interview considers why the currency value (of the US dollar) has declined since the breakdown of Bretton Woods. This led to an interesting post by Mike Norman, who argues that, against a broad basket of currencies, the US dollar has not declined* in value but in fact risen. Both Wray and Norman make valid points, but my understanding is that they are discussing different things. Norman is considering the external value of the currency (i.e. exchange rates), whereas Hartmann and Wray appear to be discussing the domestic value of the currency. It would be possible for the external value of the dollar to have risen against a broad basket of other currencies even though the domestic value of the dollar has declined. However, this latter tendency does not prevent all the dollars in aggregate from purchasing more real output now than in the past. Nor does it prevent a given amount of labor time from commanding more real output than in previous periods.