G7 Joins Japanese Central Bank in Nonsense Babble
The G7 recently met and babbled the same nonsense as the BOJ as we recently pointed out.
Next, they are "reassured" that the Japanese government's polices are "not intended" to weaken the yen. Of course, those policies do indeed weaken the yen - for example, 30% against the U.S. dollar since last November - but the G7 now accepts that the Japanese policy is "not intended" to weaken the yen.
Finally, let's note that while each country has "not intended" to depreciate its currency, the value of each currency has fallen throughout the last decade, despite these countries not "seeking" to have their policies result in such a fall. And as one currency depreciates, the result is that the products of that country become more competitive in world markets, because they become cheaper. And as that country's products become more competitive, other countries then pursue policies that will make their products more competitive. And what might make their county's product more competitive? Why, depreciating their currency! But of course, their policies are "not intended" to depreciate the currency. The policies are "seeking" to make their products more competitive - not depreciate their currencies.
Is this starting to sound silly yet?
But wait! As if to show just how astute these ministers really are, some of the participants
Well, perhaps saying this sounds "silly" really doesn't capture what's going on here. Perhaps we might consider that these ministers are dissembling - which is the attempt to hide of conceal one's true intentions.
Look, I'm making every attempt here not to just say these people are lying. That would be much too harsh, don't you think?
(You can read the whole silly, nonsensical, dissembling article by clicking HERE.)
Finance ministers and central bank governors of the Group of Seven rich economies have reaffirmed a commitment not to seek to depreciate their currencies for domestic gain.So, first they reaffirm that they do not "seek" to depreciate their currencies. Of course, the policies they follow do, in fact, depreciate their currencies, but they're not "seeking" to do so.
After an informal two-day gathering in a country house hotel outside London with no communiqué, participants said on Saturday they were reassured by Japan that its revolutionary new economic strategy was not intended to weaken the yen.
Next, they are "reassured" that the Japanese government's polices are "not intended" to weaken the yen. Of course, those policies do indeed weaken the yen - for example, 30% against the U.S. dollar since last November - but the G7 now accepts that the Japanese policy is "not intended" to weaken the yen.
Finally, let's note that while each country has "not intended" to depreciate its currency, the value of each currency has fallen throughout the last decade, despite these countries not "seeking" to have their policies result in such a fall. And as one currency depreciates, the result is that the products of that country become more competitive in world markets, because they become cheaper. And as that country's products become more competitive, other countries then pursue policies that will make their products more competitive. And what might make their county's product more competitive? Why, depreciating their currency! But of course, their policies are "not intended" to depreciate the currency. The policies are "seeking" to make their products more competitive - not depreciate their currencies.
Is this starting to sound silly yet?
But wait! As if to show just how astute these ministers really are, some of the participants
...say it is counter-productive for everyone to attempt to reduce demand and boost exports simultaneously...Brilliant! Indeed it is counter-productive. After all, how can everyone simultaneously depreciate their currencies to make their products more competitive. That would be a case of "competitive devaluation," which when it gets intense enough, goes by the name of "currency war." But, of course, we all know that there is no competitive devaluation, and certainly no currency war, because all these countries are not "seeking" nor are they "intending' to depreciate their currencies. The depreciation, we must suppose, is simply a by-product - an "unintended" by-product - of their policies.
Well, perhaps saying this sounds "silly" really doesn't capture what's going on here. Perhaps we might consider that these ministers are dissembling - which is the attempt to hide of conceal one's true intentions.
Look, I'm making every attempt here not to just say these people are lying. That would be much too harsh, don't you think?
(You can read the whole silly, nonsensical, dissembling article by clicking HERE.)
Comments