Why has the price of gold been increasing so fast, breaking records? Economist Michael Hudson explains the politics of the precious metal, and the dynamics of the US dollar system.
Thank you for this great read and sharing the cultivated information with us. I have been curious about how gold fit into the modern fight against imperialism.
If we are going to have any chance of provoking positive change, we have to understand the economic arguments levelled against us and be able to argue that they are not infallible, that there are feasible alternatives. Thank you!!!
As usual a very informative article by Michael Hudson. Hopefully the following question can be answered. It is about currency manipulation with reference to the Plaza Accord which obviously does not add up with what was said in the posting.
Essentials with the ‘Plaza Accord’:
1.Decrease the value of the USD and
2.Deregulate Germany's and Japan's economy by loose monetary policy, liberalized markets and cut government spending.
To accomplish the first part the primary goal was to decrease the value of the USD - Germany/Japan dumped a massive portion of its USD foreign reserves, flooding markets with $ and drive its value down.
As a result the higher relative value of the Yen made Japan's exports less competitive.
This raises a question with the remark of 'sending back dollars to the US to prevent the value of the currency from going up', because it seems contradictory here as it should have the contrary effect to what is asserted - like in the Plaza accord - not to keep the exchange rate down but to make exports less competitive because the value of the currency should go up relatively vis a vis the dollar.
Does a swap of central bank dollars for dollar denominated debt in the form of treasuries have the effect to reversing that? If so, why not just keep dollars as foreign reserves in the first place? Treasuries of course have the advantage over money to pay interest.
Thank you for this great read and sharing the cultivated information with us. I have been curious about how gold fit into the modern fight against imperialism.
Excellent read. I learned a lot.
If we are going to have any chance of provoking positive change, we have to understand the economic arguments levelled against us and be able to argue that they are not infallible, that there are feasible alternatives. Thank you!!!
Michael's comment: "The game is over for the West". Well said!
As usual a very informative article by Michael Hudson. Hopefully the following question can be answered. It is about currency manipulation with reference to the Plaza Accord which obviously does not add up with what was said in the posting.
Essentials with the ‘Plaza Accord’:
1.Decrease the value of the USD and
2.Deregulate Germany's and Japan's economy by loose monetary policy, liberalized markets and cut government spending.
To accomplish the first part the primary goal was to decrease the value of the USD - Germany/Japan dumped a massive portion of its USD foreign reserves, flooding markets with $ and drive its value down.
As a result the higher relative value of the Yen made Japan's exports less competitive.
This raises a question with the remark of 'sending back dollars to the US to prevent the value of the currency from going up', because it seems contradictory here as it should have the contrary effect to what is asserted - like in the Plaza accord - not to keep the exchange rate down but to make exports less competitive because the value of the currency should go up relatively vis a vis the dollar.
Does a swap of central bank dollars for dollar denominated debt in the form of treasuries have the effect to reversing that? If so, why not just keep dollars as foreign reserves in the first place? Treasuries of course have the advantage over money to pay interest.