Currency Wars

Currency Wars: The Making Of The Next Global Crisis describes the various different currency wars that have been carried out by nations in an attempt to obtain certain economic advantages. The book describes a currency war as a tactic used by different nations in an attempt to boost their own economy. In order for this to happen, the country must first devalue its own currency which will lead to a lower exchange rate for the home nation’s currency on the global market. After this step has been achieved, domestic exports become cheaper while at the same time foreign imports become more expensive. Because of this, domestic industries tend to do much better; leading to even more employment opportunities, higher salaries, etc., which will help to stimulate the domestic economy. When other counties respond to this by devaluing their own currency, it is known as a currency war. There are almost always no victors when it comes to currency wars. This book describes these currency wars in great detail and attempts to illustrate how chaotic and disastrous that they can be. Because of this, Rickards promotes doing away with currency wars.

This book highlights certain economic/financial methods used by various governments in an attempt to boost their own economy and place them at the top of the proverbial food chain. Unfortunately, competitive devaluation is a main weapon in the arsenal of financial tactics to achieve that very goal. Rickards tells us how badly major currency wars in the past have always ended – we should not engage in them.

In 1971, president Richard Nixon imposed national price controls and took the United States off of the gold standard. He did this as an extreme measure to end an ongoing currency war that had b...

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...Their theories have not only malfunctioned to avert a tragedy, they’re causing the currency wars to be even worse than they currently are. The U.S. Federal Reserve has became involved in the biggest risk in the happenings of finance by printing trillions dollars in an attempt to jump-start the American economy. By doing this, the U.S. Federal Reserve is actually creating more problems than solutions.

Whereas the end result of the present-day currency war is uncertain, some variant of a worst-case scenario is nearly guaranteed if the world’s economic leaders don’t learn from the miscalculations and faults of the people that came before them. In Currency Wars, Rickards describes the web of failed paradigms, arrogance, and wishful thinking, in an attempt to lead to a more effective and informed plan of action when it comes to nations, governments, and currency wars.