Americans' first instinct is to cheer when they hear that the dollar has surged against other nations' currencies. And the dollar looked especially potent last week as it hit a 10-year high Jan. 6 against the German mark and broke records against the British pound, French franc, and Italian lira. On Monday the dollar opened higher against all these currencies in early trading.
But the dollar's recent rapid runup - and the consequences it may help trigger - are a mixed blessing for consumers, economists say. On the one hand, by luring foreign investors, a strong dollar increases the supply of investment funds and thus helps hold down interest rates in the United States. And a robust dollar aids in cooling US inflation by making imported goods relatively cheaper to buy, thus exerting downward pressure on domestic producers' prices.
''The winners are diffused throughout the economy'' and include the housing and high technology capital-goods industries, says David D. Hale, chief economist at Kemper Financial Services.
But the drawbacks of a surging dollar go beyond the well-known effects on US exporters - like machine-tool and farm-equipment makers - who have a hard time selling abroad when a strong dollar makes their products more expensive. Largely as a result of the dollar's current strength, the US is expected to sell $100 billion less to foreigners in 1984 then it buys from them. This growing trade gap could eliminate up to 2 million jobs by the end of 1984, according to C. Fred Bergsten, director of the Institute for International Economics (IIE).
Economists now warn that when foreign individuals and institutions cool on dollar investments, as is expect, US inflation and interest rates could soar as the dollar's value declines. ''The crisis is in the end inevitable, but the timing is unforecastable,'' says Stephen Marris, senior fellow at the IIE.
Many forecasters say the dollar is overvalued by as much as 20 percent - about equal to the dollar's current standing, 18.5 percent above the average 1980-82 value of the currencies of 15 major trading nations, according to Morgan Guaranty Trust Company data. A 20 percent drop in the dollar would add about 3 percent to the consumer price index (which rose 3.2 percent for the 12 months ending in November), IIE calculations show.
Even without such a sharp decline, in a few years the US could find itself a net debtor, a position the US has not been in for seven decades. To become a debtor nation, the US would run up debts to foreigners in the course of paying for imports. Eventually the debts would be larger than the assets the US owns overseas.
''It is likely to happen,'' says Martin Feldstein, chairman of the President's Council of Economic Advisers, adding that is likely to happen sooner than the 1988 target some private forecasters are using.
If the US moves into a net debtor position, it would affect all Americans, economists say. At the moment, the US earns more on its investments abroad than it pays to foreigners for investing in dollar assets here. That surplus can be used to help pay for the goods the US imports. But as a net debtor nation, the US would have to export more than it imports to pay its debts.
''The loss to Main Street is that if we export more and import less, there is less for Americans to consume. They are poorer by that amount,'' Mr. Marris says.
Although the movement to a net debtor position is expected to take several years, the dollar's high value is already adding to protectionist pressures.
''It is happening despite a very strong recovery,'' Mr. Feldstein notes. The steel, auto, and textile industries, among others, all recently have sought protection.
While the dollar rises or falls for a host of reasons, high US interest rates - and the big deficits that help prop them up - have played a major role by making it an attractive investment for foreigners.
The dollar ''will come down a little bit'' by the end of January, says Jonathan Francis, currency forecasting director at Wharton Econometric Forecasting Associates. During 1984 he says the dollar may drop 5.2 percent on a trade-weighted basis vs. a rise in 1983 of 12.6 percent. But if traders start to expect lower interest rates, ''then you will see quite a sharp drop.