By Rerun Shen Sun Oct 30, 2011 11:11pm EDT SINGAPORE (Reuters) - Gold prices dropped about 2 percent on Monday, after Japan's intervention in the currency market triggered a rapid rally in the dollar, spooking precious metals investors. http://www.reuters.com/article/2011/10/31/us-markets-precious-idUSTRE78M11C20111031
Is it not a case that the Japanese intervene, by devaluing their currency, in an attempt to ensure their manufactured export products remain affordable to the US and Europe customers. To me this seems like they are trying to maintain their place in the market rather than being priced out of competition as has happened to Australian manufacture's because of the high value of $A.
no growth, no investment in japan for two decades all to keep toyota and sony profitable? Keynesian economics is disastrous policy, Japan is a basket case and europe and US are not far behind.
I recognise your point...however I cannot see a politically acceptable alternative for any of the economies you mentioned. All the powerful governments have central banks fiddling with financial policy [I understand this is the heart of Keynesian Economics] so if these central banks were to sit on the sidelines and let a full blown correction [depression] take hold there would be terrible upheaval of society, loss of quality of life ect.. I cannot imagine any government willingly taking this path, after all one of their roles is to protect their constituents [utopic, I know]. Accordingly I would expect that my government would take interventionist policy when needed too.
