It appears the pulp and paper industry will arrive at 2008 in fairly good shape. Most grades seem to be in balance worldwide and capital spending is moderate—-no extremes to the upside or down. I think most executives in the industry can approach 2008 with only a small bottle of antacids-—a good place to be.

There is always a “but” though, and here it is: The U.S. dollar. The U.S. dollar has fallen 26% against the Euro since 2002. The Canadian dollar is worth more than the U.S. dollar for the first time in 30 years. The major problem with this is that money-center banks keep their reserves in dollars. If a panic sets in, the first few that exchange dollars for something else will be OK, the rest will have a big problem, meaning you and I (and I don’t care where you live, this is not just a U.S. problem) will have a big problem, corporately and personally. The U.S. dollar may be the big story of 2008.