World Currency War Question

avelanchefan

I am in no way trying to make this political, so please anyone wanting to make it that just stay away from this question.

I try to keep up on the current world financial situation on a daily basis, mainly because everyday there is something new, and the markets are obviously reacting to it.

So my question is....about this story that is headlineing Bloomberg.com.
http://www.bloomberg.com/news/2011-09-06/swiss-open-new-round-in-currency-wars-ignited-by-global-economic-slowdown.html

This is the not the first time I have read this type of story over the past couple of months. I am just trying to wrap my head around why any country would try to devalue their currency? That is what they are trying to do right?

So can someone give me the dumbed down version of why to do this? Is it because of import/export issues?

unc2701

The Swiss have to sell and export goods for their economy to survive. Investors buying their currency had driven up the value of it to the point where people couldn't afford to buy their goods, damaging their economy.

Also: currency speculation is destabilizing; the Swiss place a high value on stability. This allows them to control the value of it without a huge increase in value followed by a crash.

tonyb

It's alittle more complicated than that. Google some stuff and get your read on. Once you grasp the basic principles, things will come together like a finished puzzle.

bobman1235

It may help your Googling if you spell currency correctly, though

tonyb

lol...yeah, might help a tad.

Talking about world currency will no doubt run down the political road, so I won't say too much. But in your search, think along the lines of "world reserve currency", or "devaluation as a tool to control prices."
History will show that whenever price controls were brought about, it never worked. This subject can easily carry over into world trade,price fixing, banking, and world control. All of which will tumble into the political aspect of things so probably best we leave this one for the Polk Army board.