Financial crisis but dollar going up?

For a while now, the dollar has been going down compared to the Euro, until the beginning of this financial cris, when it started to go up, significantly. Why is that? This is a world-wide crisis, but I would expect the US to be more impacted than the rest of the world, which means the dollar should have gone down. You have an explanation?Financial crisis but dollar going up?The exchange rate it determined by the flow of capital due to trade and investment.. After the dollar fell our exports increased because they were cheaper, our slowing economy reduced the demand for oil an therefore the price, so the dollar amount of our imports decreased. The increase in the deficit created a large amount of new government bond which attracted foreign investment. This accelerated with the bailout and the crisis because despite our problems US bonds are considered one of the safest ways to hold money.Financial crisis but dollar going up?The dollar has declined in anticipation of the crisis relative to other world currencies. When it became apparent that the crisis was not isolated to the US economy, the currency market corrected by deflating the value of most foreign currencies relative to the dollar.



That's what I read. I really believe it's all just fear and greed. It's just not logical that an Aussie dollar is worth 95 cents 2 months ago and 75 cents today. Not much has really changed fundementally in 2 months. It's just perception fueled by fear and greed.