Global Currency talk gains steam…
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G-20 Should Seek Global Currency ‘Harmony,’ Larosiere Says
Sept. 28 (Bloomberg) — Leaders of Group of 20 nations must build a “more harmonized” global currency system to prevent the risk of competitive devaluations, said Jacques de Larosiere, author of a European report into the roots of the financial crisis.
“We have an international monetary system that doesn’t function well,” de Larosiere, the former head of the International Monetary Fund and the Bank of France, said today in an interview with Bloomberg Television in Brussels. “It’s a real concern.”
Brazil’s Finance Minister Guido Mantega said yesterday that a “currency war” has begun, with nations seeking to lower the value of their currencies to bolster exports. Japan this month broke a six-month policy by selling yen, joining countries across Asia and Latin America that have tempered gains in their currencies against the dollar in a move that drew criticism from the U.S. and euro area.
Today’s international monetary system “is a regime where people intervene on the markets to peg their currencies more or less to some others,” de Larosiere said. Monetary policies leading to a “beggar-thy-neighbor attitude” are “very dangerous,” de Larosiere said.
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