Translated material
Currency truck
The main economic events of this fall unfold on foreign exchange fronts. World markets have been in a fever since the beginning of September. “Monetary Wars” became the subject of fierce discussions around the world and were issued as the main theme of the November Summit “Big Twenty”.
The first phrase “Currency War” was the Brazilian Minister of Finance Guido Mantega at the end of September. “We are in a state of international currency war, general weakening of currencies. This war threatens our competitiveness, ”all world information agencies quoted Mantega. However, at that time it was already a statement of fact. The Brazilian Real has already strengthened the dollar by more than a quarter compared to the beginning of 2009. The dollar fell to other currencies, and in some cases to historical minimums, and the Central Bank began to act.
For the first time in 15 years, the Bank of Japan conducted a large-scale intervention, pouring almost 2.5 trillion yen (about $ 20 billion) in one day on one day, but this did not help, and the Japanese national currency continued to strengthen throughout October, updating 15-year-old maximums. The Central Banks of South Korea, Switzerland, Indonesia, several other countries made large -scale interventions. Brazil, and after it and some other countries, went on a different path, introducing fiscal restrictions on the influx of “hot” money. However, few managed to succeed - the dollar continued to depreciate, and not only in relation to the main currencies, but also to the gold, which broke the next historical record, exceeding the mark of $ 1400 per ounce.
The reason for the sale of the American currency was the September meeting of Fed, at which representatives of the US monetary authorities expressed dissatisfaction with the pace of restoration of the American economy and warned about the possibility of developing the next “quantitative mitigation” program or, more easily, to include a printing press to buy off the national economy at the expense of direct monetary issue.
Interestingly, the weakening of the dollar was accompanied by unprecedented pressure on China, the purpose of which was the accelerated revaluation of the yuan. Moreover, the case was not limited to persuasion. A few days after the mentga’s statement on the beginning of the currency wars, the House of Representatives of the US Congress approved a bill that allows you to introduce trade sanctions against countries that artificially underestimate the national currency to increase their own export. At the same time, the congressmen did not hide that the main target of this law is China.
The alarm and the European authorities began. The rapid growth of the euro to the dollar and the “attached” to the American currency Yuanu put European exporters in a very unpleasant position. Within the framework of the Asia-European summit in Brussels, the European leaders in a harsh form demanded that the PRC chairmen accelerate the strengthening of the Chinese currency. However, Wen Jiabao answered no less harshly: “We can’t even imagine how many Chinese enterprises will go bankrupt, how many Chinese workers will lose their jobs, how many labor migrants will return back to their villages if China agrees to the requirements of Yuan by 20-40%. In this case, China is threatened with huge social shocks. ” After this statement, he advised European leaders once and for all to close this issue.
The theme of the "Monetary Wars" became the main at the Seoul summit "Big Twenty". The leaders of the leading economic powers agreed not to resort to the artificial devaluation of their national currencies. This promise was also reflected in the final communique of the summit. It would seem that you can sleep calmly: if not the world, then, at least, a truce.
However, in reality, a few days before the summit, Fedor -Rurev announced the decision to start a program of ransom from the market of long -term government bonds in the amount of $ 600 billion, which will last until the end of the second quarter of next year. Given the fact that the funds received by the American Central Bank as a result of the repayment of previously purchased papers will again be allowed to redeem the assets, the scale of the program will amount to $ 950 billion - almost a trillion. It is worth recalling that the “Planes Plan”, adopted in the midst of the crisis, when the entire world economy was put on the map, was more modest. Then only 787 billion was printed.
However, not only the United States resort to the printed machine. The Bank of Japan, struggling with deflation and excessive strengthening of Jena, reduced the accounting rate from 0.1% to zero and, without waiting for the decision of Fed, announced his program of redemption of assets, although not comparable in scale with the American one. Preparing a program for redemption of assets and the Bank of England.
And even if the main goal of all these programs is officially in supporting national economies, and not at all in the devaluation of national currencies, this does not change the essence of the matter. The so -called “world currencies”, led by the dollar, rapidly lose their trust, which is poured into the growth of gold and exchange products - oil, industrial metals, grains. Large financial institutions and central banks are frantically looking for a way to protect their reserves.
In these conditions, the idea of a new world reserve currency is becoming increasingly popular. The head of the World Bank Robert Zelelik proposed shortly before the Seoul summit of the phased transition to the modified “gold standard”. In fact, he wants to combine two systems - baskets of currencies and the gold standard. According to Zellik, the basket "apparently should include the dollar, euro, yen, pound and yuan." “The system should also provide for the use of gold as an international guideline of market expectations regarding inflation, deflation and the future value of currencies.” The problem is that this idea has no practical meaning. It is simply impossible to use such a bulky mechanism in international trade, in addition, it does not involve the presence of the emission center. As for reserves, they are that state, that private financial institutions have already represented the notorious “baskets”, which are filled with managers in accordance with their ideas about reliability.
Nevertheless, the problem of the reliability of money is acute than ever. The widespread use of the printing press threatens to result in global inflation. She has already begun to grow rapidly in countries suffering from excessive tributary of “hot money”. However, if everything is limited to inflation, then this is still half -worn. It is much worse if the “currency wars” will develop into trading, and countries that will not be able to succeed on the currency front will begin to protect national markets with the help of protectionist measures.