Printing pressure: Global currency war and the global recovery

Video

 

 

 

 

Event Summary

In the aftermath of the global financial crisis, tepid growth and low demand have decreased the share of wealth to be split among nations. In response, central banks have ratcheted up their balance sheets, weakening their currencies and exporting deflation to their trading partners.  At an AEI event on Monday, a panel of experts addressed whether the world is entering a more intense phase of currency war that will threaten global recovery.

Jeffrey Frankel of Harvard University argued that the "emerging" monetary-policy disagreements have actually always existed. Anne Krueger of Johns Hopkins University supplemented this view by pointing out that the major capital adjustment that was necessary before the global financial crisis remains necessary, yet the political will to carry out the adjustment still does not exist. According to Rakesh Mohan of the International Monetary Fund (IMF), the IMF, which has a pivotal role in the monetary system, is ill-equipped to address this issue because it cannot adjust fast enough to meet the huge surge in capital flows from developed nations. 

Alberto Musalem of Tudor Capital Management offered a more market-based perspective, claiming that the necessary reforms are really rather small, but too contentious to be proposed. Central banks, he said, have pursued rational domestic policies but have largely ignored the international effects. In closing, AEI's John Makin predicted rough times ahead for the global economy as nations try to adjust their government finances and central banks print money.

--Daniel Hanson

Online registration for this event is now closed. Walk-in registrations will be accepted.

Central banks in Japan, the United Kingdom, the United States, and the eurozone are responding to financial woes by printing more money, giving rise to fresh concerns about the outbreak of a currency war. With massive expansions in the balance sheets of the Bank of England, Federal Reserve, European Central Bank, and Bank of Japan, exchange rates have moved sharply over the past year.

In the wake of the G20 meetings addressing competitive currency devaluations, this expert panel will discuss if this feared currency war is indeed underway and what concerns might arise as global quantitative easing continues. The panel will also discuss how exchange rate fluctuations might threaten the global economic recovery and chart a prudent way forward.

If you are unable to attend, we welcome you to watch the event live on this page. Full video will be posted within 24 hours.

Also Visit
AEIdeas Blog The American Magazine
About the Author

 

John H.
Makin
  • John H. Makin is a resident scholar at the American Enterprise Institute (AEI) where he studies the US economy, monetary policy, financial markets, corporate taxation and banking. He also studies and writes frequently about Japanese, Chinese and European economic issues.

    Makin has served as a consultant to the US Treasury Department, the Congressional Budget Office, and the International Monetary Fund. He spent twenty years on Wall Street as the chief economist, and later as a principal of Caxton Associates a trading and investment firm. Earlier, Makin taught economics at various universities including the University of Virginia. He has also been a scholar at the Bank of Japan, the Federal Reserve Bank of San Francisco, the Federal Bank of Chicago, and the National Bureau of Economic Research. A prolific writer, Makin is the author of numerous books and articles on financial, monetary, and fiscal policy. Makin also writes AEI's monthly Economic Outlook which pairs insightful research with current economic topics.

    Makin received his doctorate and master’s degree in economics from University of Chicago, and bachelor’s degree in economics from Trinity College.


    Follow John Makin on Twitter.

  • Phone: 202-862-5828
    Email: jmakin@aei.org
  • Assistant Info

    Name: Brittany Pineros
    Phone: 202-862-5926
    Email: brittany.pineros@aei.org

 

Desmond
Lachman
  • Desmond Lachman joined AEI after serving as a managing director and chief emerging market economic strategist at Salomon Smith Barney. He previously served as deputy director in the International Monetary Fund's (IMF) Policy Development and Review Department and was active in staff formulation of IMF policies. Mr. Lachman has written extensively on the global economic crisis, the U.S. housing market bust, the U.S. dollar, and the strains in the euro area. At AEI, Mr. Lachman is focused on the global macroeconomy, global currency issues, and the multilateral lending agencies.
  • Phone: 202-862-5844
    Email: dlachman@aei.org
  • Assistant Info

    Name: Emma Bennett
    Phone: 202.862.5862
    Email: emma.bennett@aei.org

What's new on AEI

image The money in banking: Comparing salaries of bank and bank regulatory employees
image What Obama should say about China in Japan
image A key to college success: Involved dads
image China takes the fight to space
AEI on Facebook
Events Calendar
  • 21
    MON
  • 22
    TUE
  • 23
    WED
  • 24
    THU
  • 25
    FRI
Wednesday, April 23, 2014 | 12:00 p.m. – 1:30 p.m.
Graduation day: How dads’ involvement impacts higher education success

Join a diverse group of panelists — including sociologists, education experts, and students — for a discussion of how public policy and culture can help families lay a firmer foundation for their children’s educational success, and of how the effects of paternal involvement vary by socioeconomic background.

Event Registration is Closed
Thursday, April 24, 2014 | 12:00 p.m. – 1:30 p.m.
Getting it right: A better strategy to defeat al Qaeda

This event will coincide with the release of a new report by AEI’s Mary Habeck, which analyzes why current national security policy is failing to stop the advancement of al Qaeda and its affiliates and what the US can do to develop a successful strategy to defeat this enemy.

Friday, April 25, 2014 | 9:15 a.m. – 1:15 p.m.
Obamacare’s rocky start and uncertain future

During this event, experts with many different views on the ACA will offer their predictions for the future.   

No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.