"Currency war": there are no winners in a game.

<P> While countries agreed to deepen the International Monetary Fund (IMF) as the "exchange rate the police" role, but could not find common ground, has been unable to reach consensus on specific agreements. .Governments had to "peace" to deliver the aspirations held in Seoul next month, the Group of 20 (G20) summit. .</ P> <P> analysts pointed out that once the "currency war" broke out, and ultimately will lead to global trade war, and even endanger the global financial system. .</ P> <P> 1 back: depreciation of the dollar </ P> <P> the lead in the second annual meeting of IMF and World Bank on exchange rate issues, the world's major economies, began to draw the front. .US-led Western developed economies, exchange rate misalignment will blame others, and emerging economies is the United States accused the extremely loose monetary policy led to the influx of hot money and make the global exchange rate system and imbalance. .</ P> <P> as the IMF's Strauss-Kahn said: "RMB revaluation should not be covered by his government as a fig leaf for their questions. Scapegoating always easy." </ P> <P> this ."currency war" can not be ignored behind the depreciation of the dollar is the dominant factor. .As the primary international reserve currency, the United States can be diverse and subtle ways, for example, affect the market transaction through the U.S. Treasury interest rates and money supply, or by lowering benchmark interest rates affect the dollar exchange rate. .</ P> <P> recent months, the Fed will once again expand the money supply, thus further reducing the expected short-term U.S. bond yields have been putting pressure on the dollar and boosted the euro, yen and other emerging markets .currency. .This forced some governments to take response measures. .</ P> <P> Brazilian Finance Minister Mantega October 9, said, "and the rapid expansion of the zero interest rate monetary policy to stimulate domestic demand though, but also led to currency devaluation. So developing countries will continue to accumulate foreign exchange reserves .thus avoiding the "volatility and appreciation". </ P> <P> the People's Bank of China Deputy Governor Yi Gang during the annual meeting of the "Business News", told reporters that the current U.S. interest rates are at historically low levels, emerging markets .national monetary policy, "recipient", rather than the makers, the carry trade to a large extent explains the result of capital inflows in emerging market countries facing appreciation pressure. </ P> <P> Brazil's former Minister of Finance .Pedro Malan (PedroMalan) In an interview with "Business News" interview, also said the dollar carry trade is the result of low interest rates in emerging markets mainly due to currency appreciation pressure. </ P> <P> Russian Deputy Finance Minister .Pankin (DmitryPankin) at the annual conference that China, Brazil, Russia and India will be the currency of any sharp evaluation of the control to be strongly resisted. Pankin said the four countries have agreed position that the exchange rate itself is not a problem, but only .willingness to invest such savings will and the result of deeper problems. </ P> <P> 2 results: there are no winners </ P> <P> more and more countries are trying to devalue the currency to increase export competitiveness, stimulate economic growth .. Despite the current national action to intervene in currency markets is still relatively modest, but there is still imminent danger. EU Economic and Monetary Affairs Commissioner Rehn said: "The war is not a currency, but competitive or competitive devaluation does not appreciate the perspective .Obviously, the situation moving in an unfavorable direction. ."</ P> <P> analysts pointed out that if the" currency war "were to happen, the Federal Reserve estimated in 2011 will clearly be the extent to which, after further quantitative easing policy. If there are signs that the Fed's policy of quantitative easing .measures more restrained, may still stabilize the foreign exchange market. </ P> <P> a certain sense, the current "currency war" is more like money in the name of the modern trade war. Since the crisis, the export trade .restore economic growth to become the world's lifeblood, and countries can not directly use tariffs to protect their commodity, currency devaluation as an important shield to increase competitiveness. </ P> <P> However, despite the devaluation to promote exports, but also damage the trading partners .interests, which may take the depreciation of the same strategy. and currency war "losers" will launch a trade war pre-emptive attempt by way of re-establishing trade barriers for trade advantage. </ P> <P> Once this multi-country .game "currency war" broke out, countries in the tooth for a tooth, tit for tat actions into a vicious circle. The global economy will slide into a fear of trade protectionism, "melee", the end result will be a collective defeat. </ P> .<P> has successfully predicted the credit crisis, economics professor at New York University Lubin Ni (NourielRoubini) recently said: "We are in a devaluation of the world all want, but every currency devaluation is not balanced .. .Currency intervention will eventually lead to trade war war. ."</ P> <P> this" war "is far more than the influence of the trade level. Currency brokers may also be in trouble, as did 2008 and suffered heavy losses. Their loss will further spread to the global financial system .other areas, the consequences would be unthinkable. </ P> <P> as Korean Ministry of Finance Planning Executive Yoon Jeung-hyun pointed out, if all countries cooperate with each other, can achieve better results, if the distrust, and pursue their own interests, will be faced with ."worst case". </ P> <P> 3 address: Urgent global collaboration </ P> <P> the last century, the Great Depression 30 years has proven this "worst case." In response to the Great Depression and then .protect American jobs, the U.S. passed the "Smoot - Hawley Tariff Act" (Smoot-HawleyTariffAct), a substantial increase in tariffs on most imported products, triggering a trade war, global recession deepened. </ P> .<P> Federal Reserve Chairman Ben Bernanke has repeatedly stressed that, in 1929, after the stock market crash, the world if not to the extreme protectionist trade policies, maybe we will not fall into the last century, the Great Depression of 30's appalling. </ .P> <P> World Bank President Robert Zoellick called for international cooperation to solve the problem, avoid repeating the 30's during the Great Depression countries to take selfish strategy error: "History has proved that selfish, beggar thy neighbor policy is no way out. .If we fall into strife or into any form of protectionism, then we may repeat the Great Depression of the thirties of last century when the mistakes. ."He said, governments current dispute on the exchange rate will hit investor confidence is not conducive to private sector participation into the world economic recovery. </ P> <P> French Finance Minister Christine Lagarde (ChristineLagarde) said during the meeting .: "We want (money) peace rather than 'war'. ."The French central bank governor, Noah (ChristianNoyer) also said policy makers around the world need to" develop the market confidence, rather than launching the currency war. ."He pointed out that excessive exchange rate volatility would damage economic growth. </ P> <P> At the same time, Kahn called on countries not only in words, mild language, but also to take concrete steps:" Language is not valid .. .Language can not change things, we must adopt specific policies. ."</ P> <P> 4 follow-up: the exchange rate or the leading G20 summit </ P> <P> Rehn also called on countries around the world need to strengthen coordination of monetary policy in order to avoid exchange rate fluctuations and achieve more balanced economic growth. He .that such collaboration can be the framework of IMF or the G20. </ P> <P> British Chancellor of the Exchequer George Osborne (GeorgeOsborne) on Friday said: "We do need to be more market-oriented, reflecting the basic .surface exchange rate mechanism, G20 and the IMF should play a role in helping achieve this goal. ."</ P> <P> Because it is difficult to find common ground, governments agreed at the annual meeting by the IMF to act as" exchange rate the police "role, the development of relevant reports to show how the policies of one country to other countries. These studies will mainly .concentrated in the United States, China, Britain, the euro zone. </ P> <P> Kahn said: "The spillover effects of the discussion of the report have been carried out for several months, and now has become our 'toolbox' part. ."</ P> <P> In addition, IMF's Strauss-Kahn on Friday also made a" systemic stability "of the initiative. In accordance with the initiative, IMF coordination in many areas to alleviate the" money .war "tensions. But in the end of the IMF meeting, he proposed a more narrow approach that will focus on strengthening the IMF to members on the review of exchange rate policies. </ P> <P> many officials support .IMF exchange rate to play a greater role, but also that the IMF a more limited capacity to act, because the organization can not force members to accept his views. Some officials suggested the IMF should continue to play in the G20 meeting of advisory role. </ .P> <P> exchange rate is likely to be held in Seoul next month's Group of 20 (G20) summit, the dominant issue. if the differences between countries summit in Seoul are still unable to get mediation, will mark the G20 is .response to the financial crisis and the formation of the united front broken. </ P>.