[Porsche-O-Phile]

I think we all know that the U.S. dollar is in the tank with respect to foreign currencies right now, particularly the Euro. My understanding is that a lot of this is due to lack of investor confidence in the U.S. economy, largely related to the whole housing bubble fiasco (driving down the demand for dollars). However I have also come across articles that cite excessive foreign holdings in the U.S. (particularly Chinese) as being a reason for dollar declines. This seems a bit counter-intuitive to me - wouldn't foreign holdings be reflective of HIGHER demand for U.S. dollars and push value/price UP? Or is this analysis too simplistic?

Also, I read yesterday that the nation's money supply (directly controlled by the Federal Reserve) is actually a private banking institution and not directly accountable to the people. This seems a bit strange, I always thought the Federal Reserve was an extension of the U.S. Treasury Dep't. By extension, wouldn't this make the Federal Reserve an extension of the Executive Branch? Or is it the Legislative (Congress). In other words, who ultimately calls the shots about how many dollars are in circulation? And is oversupply the ultimate culprit in the declining dollar right now?