A weak dollar is not enough

“A competitive devaluation only works if you do it Scandinavian style, that is to say with a major and substantial commitment to institutional reform. Argentina (in its day) and now Greece do the devaluation to AVOID institutional reform (or Russia after 1998) and that in the end always ends badly.” (Edward Hugh)

This message needs to be absorbed by American political and financial leaders.  FRB Chairman Bernanke has been driving a devaluation of the dollar, but little to no institutional reforms are occurring due to the regulatory capture of American financial authorities by major financial institutions and interest groups.  If  the US is to resolve its current economic problems, major restructuring of financial and trade policy is a necessity.


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