A good blog post from John Aziz about protectionism and trade wars: http://azizonomics.com/2012/12/04/when-currency-wars-become-trade-wars/
We can't possibly compete with Brazilian or Mexican factories, yet their factories cannot hope to compete with China. Kind of looks bad for us....
Gerald has been over this a while now... [youtube]http://www.youtube.com/watch?v=OVtolX5N3uI[/youtube]
:lol: How dare those Americans try to cheapen their exports by cheapening their currency! We want to work harder so that we can make cheap stuff to sell to the Americans. It is in the interests of the Brazilian people to work harder for expensive fiat US$ rather than work less for cheaper advanced US goods and services. Damn you peasants - only we, the Brazilian Government, have your best interests at heart - slaving away for those bastard Americans. And while we're at it - we know that your family cannot earn enough money to eat unless everyone contributes, so we are going to ban child labour. How dare you send your 10 year olds to work just so that your family has enough income to survive! Thanks to our ban your kids can now live the life of luxury you have always wanted for them but were too selfish to give them. Now you will have to either work 20 hours a day 6 days a week (and never see them, which is fine since you were clearly a selfish peasant anyway) or force them into the lucrative child prostitution industry which has been booming since these laws (watch you don't get caught, however, as you will be dealt with harshly which will really allow your family to prosper once they are released from your evil yoke). Remember, only we, the Brazilian Government, have your best interests at heart!
Currency wars is going to be bad for everyone - except in the long-run for China, who might just restructure their economy due to sheer necessity... or civil war.