But politically, it's another country - and a Third World Banana Republic at that. What many now see as the inevitable plunge through the pyschologically potent US50c mark could have a potentially enormous impact for the Howard Government. It will take it into uncharted and highly dangerous political waters, offering a highly visible symbol of what is already widely perceived as a crisis. The political fallout, and the pressures it creates, will make an already difficult task of economic management even more complex. Crossing the Rubicon into the world of sub-US50c currencies also has the potential to sour the financial markets' attitude toward the dollar even more.
Fundamentals become increasingly less important as hopes for a rebound are crushed.
Perhaps the most Kafkaesque irony is that the politicians are largely right when they plead that the decline of the dollar is the result of much larger global forces and not a reflection of Australia's failure. They are largely right when they say the economy, and economic policy, is fundamentally in good shape. They may be right when they say the fall is temporary and will be eventually reversed when the world tires of its affair with all things American. And they are certainly right when they say there is not much they can do about it, at least in the short term. But even though it might be largely true, their story is not washing with Main Street.