Decimalization and a Strong Dollar Worthy of Thanks

Two more reasons for investors to be thankful in an otherwise very difficult year for many portfolios:

* Decimalization of stock prices finally became reality. Congress wanted the major U.S. markets to convert from fractional pricing of stocks to decimal pricing a decade ago, or longer. For a variety of reasons the shift was repeatedly delayed. But it finally happened earlier this year. Now, who even remembers quoting stocks in eighths?

The benefits of decimal pricing--including its simplicity, and its effect in shrinking the spread between Wall Street dealers’ “bid” and “asked” prices for shares--are monumental. But they haven’t been fully appreciated by many investors because the market has been such a dismal place for most of the year.

* The dollar has remained the kingpin of major currencies. Despite the U.S. economy’s slump, global investors haven’t fled the dollar. It has gained in value versus the Japanese yen, the euro and many other currencies this year.

Why is that important? A robust dollar keeps Americans’ purchasing power strong (think lower-cost imports). Also, the dollar’s strength has encouraged many foreign investors to keep their money here. Because the United States still is heavily dependent on foreign capital, it could be disastrous if foreigners chose to flee. The implications for asset prices, and interest rates, could be dire.

There are negatives to a strong dollar, but all in all, it’s better to have a healthy currency than a sick one, most economists agree.