It's still the debt and the jobs

Okay, so I may have misperceived the impact of the recent drop in the value of the dollar against the euro. It turns out that the same folks--in the 1980's called arbitragers, now unnamed but equally amoral--who manipulate the world's currencies have lately stemmed the dollar's decline. The dollar may resume its descent based on fundamentals--the wild US trade imbalance, its massive budget deficits--but currency traders are most attuned to day-to-day hints, hedges and speeches such as those by members of the Federal Reserve Bank and international agencies that are bound to protect their nations' currencies, speeches that have lately caused the traders to predict an upward blip of the dollar against the euro, softening its decline, averting a pre-panic alarm.
But the dollar is bouyed even more solidly by the purchase of American companies' stock and US debt instruments by foreigners, mostly Japanese and Chinese, who own an incredibly huge amount of these securities. They have little long-term interest in America's financial wellbeing, except as it may support their ownership of dollar-based debt and assets.
They're not fools, however. Even though, as holders of trillions of dollars in US currency, treasury notes and corporate stock, they surely don't relish a decline in the value of their holdings, they also don't want to be the last passengers off the Titanic.
If it should occur--as might happen if the US economy continues to waddle through months of unemployment and underemployment--that the dollar is confirmed to be fundamentally weak (that is, truly the currency of a failing national economy, overly beholden to the support of others) these dollar-based-asset holding nations might decide to sell their dollars and debt all at once to beat the decline that they see as inevitable. At that point, all bets are off, and we could well see a global dollar massacre.
It could happen any moment. All it takes is for the world to realize, as the next few months' figures might well reveal, that the potency of the American economy is a borrow-based fiction. Once the first foreign investor sniffs that out, watch out. Time to move to Canada, Sweden or the proverbial desert island and leave the rest of the world to fight over scraps.