Friday, October 22, 2010
Global economy and the currency issue
Countries are taking steps to gain in the short term, by trying to appreciate their currency. In the long run, this is unsustainable for the world economy. The G-20 are in South Korea trying to figure out ways to stroke their economies. Working together can benefit everyone, while everyone working separately and selfishly will likely hurt the global economy.
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A lot of interesting solutions have come from the G-20 conference including currency war solutions. Although the G-20 may have selfish tendencies, as the conference went on they seemed to looking for more gloablly productive solutions such as market level currency.
All these issues with currency valuation procedures makes a point clear - countries acting selfishly and rationally, even in a market system, can lead to problems. Hopefully the G-20 conference will result in the setting of an even playing field for all countries - selfish manipulations of currency always have negative effects.
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