My new article out on www.mises.co.za.
The world is in a currency war. What is that? It’s when governments devalue their currencies in order to protect domestic industries against foreign competition. They believe that if their exchange rate is weaker domestic producers will be able to export more products overseas because they can price their product cheaply to foreigners yet still receive a handsome price in local currency terms. They also believe that a weaker currency will protect domestic producers from foreign import competition since foreigners have to price their product more expensively in the local market just to receive the same amount in their own currency terms.
See Jim Rickards’ book on the subject.
