In 1971, President Nixon imposed national price controls and took the United States off the gold standard, an extreme measure intended to end an ongoing currency war that had destroyed faith in the U.S. dollar. Today we are engaged in a new currency war, and this time the consequences will be far worse than those that confronted Nixon. Currency wars are one of the most destructive and feared outcomes in international economics. At best, they offer the sorry spectacle of countries' stealing growth from their trading partners. At worst, they degenerate into sequential bouts of inflation, recession, retaliation, and sometimes actual violence. Left unchecked, the next currency war could lead to a crisis worse than the panic of 2008.Currency wars have happened before-twice in the last century alone-and they always end badly. Time and again, paper currencies have collapsed, assets have been frozen, gold has been confiscated, and capital controls have been imposed. And the next crash is overdue. Recent headlines about the debasement of the dollar, bailouts in Greece and Ireland, and Chinese currency manipulation are all indicators of the growing conflict.As James Rickards argues in Currency Wars, this is more than just a concern for economists and investors. The United States is facing serious threats to its national security, from clandestine gold purchases by China to the hidden agendas of sovereign wealth funds. Greater than any single threat is the very real danger of the collapse of the dollar itself.Baffling to many observers is the rank failure of economists to foresee or prevent the economic catastrophes of recent years. Not only have their theories failed to prevent calamity, they are making the currency wars worse. The U. S. Federal Reserve has engaged in the greatest gamble in the history of finance, a sustained effort to stimulate the economy by printing money on a trillion-dollar scale. Its solutions present hidden new dangers while resolving none of the current dilemmas. While the outcome of the new currency war is not yet certain, some version of the worst-case scenario is almost inevitable if U.S. and world economic leaders fail to learn from the mistakes of their predecessors.
©2011 James Rickards (P)2011 Gildan Media Corp
"[Rickards] presents a compelling case for his views and offers thought-provoking information for library patrons. This is a must-read book." (Booklist)
This book is a real eye opener. I am glad I understand this book but it is a little scary knowing the Federal Reserve bank and other central banks are continuously cooking the books in a manner that would land central bankers in prison if they were subject to private sector securities regulations.
Faced with mindless duty, when an audio book player slips into a rear pocket and mini buds pop into ears, old is made new again.
“Currency Wars” is a disturbing book because it conjures a wolf to blow your house down whether made of brick or straw. James Rickards is telling us the sky is falling because we are in a war that cannot be won without returning American dollar$ to a gold standard. The argument is that returning to a gold standard will create a level playing field for currency that will stabilize the economy and break down barriers to free trade; i.e. not free trade exactly but regulated trade. Somehow, currency backed by gold will be more stable than the full faith and credit of a government—really?
With gold at $1600 per ounce, if the dollar were pegged to gold, the value of gold would jump by a factor of 5 or maybe 10 so the rich can get richer and the middle class and poor can go fish.
Rickards argues that America has fought two currency wars in its history and is now in the middle of its third war; using weapons that cannot defend America from an economic collapse. He believes Bernanke misreads a primary cause of the depression; Rickards believes Bernanke is steering the U.S.’ economy into a ditch. Rickards argues that “quantitative easing” is a road to hyper-inflation and economic calamity because it artificially stimulates the economy with newly printed money that has no intrinsic value. Rickards suggests that the Euro crises are examples of currency instability and unpredictability in many battles being fought in the currency wars. For example, his assessment is that political and economic interests of China and Germany are the only glue that keeps countries like Greece from economic collapse.
Rickards is an attorney and an economist. That makes him capable of structuring an argument about the economy with more credibility than a bumbling blogger. However, to this bumbler, Rickards’ arguments are specious. First, other economists disagree with Rickard’s considered argument about the gold standard, Ben Bernanke for one. Second, what evidence is there that one country’s decision to return to a gold standard will reduce economic conflict among nations?
Currency wars are real but America has fought them before with results that have made it the bully of the world. Maybe America needs to learn how to be a little more humble rather than gamble on a currency play that has as much chance of causing as curing world economic collapse.
This is a profound and eye opening book on the currency wars we are experiencing today in every industrialized nation.
Yes I would just to see if this was an anomaly or really his style. The subject matter was intriguing, he just meandered around it instead of actually supporting his sub-title "The Making of the Next Global Crisis
Sure, if someone recommended it to me.
I don't understand this question.
This book came in two parts. My rule is that if I don't want to listen to the second part then it gets one star for content. This was one of those books.
This book, written during the depths of the Great Recession, seems mainly aimed a putting forward a philosophy. In the first part, he gives an account of currency developments and the move from the gold standard to the central bank system of today. But his comments are sometimes hard to believe, like when he claims that the second half of the 1800's were a time of growing prosperity. In fact it was also a time of bubbles, crashes, and periods of depression.
The second part gives an account of the global economic and monetary system around 2010. Looking back, it is a bit laughable that his doomsday scenarios have not come true. We can now say that the global economy stabilized and is growing again thanks to the efforts of the central banks and their coordination.
In the third part he argues for a gold-backed currency, but by the time he lays out the case, I was more convinced than ever that it would be a stupid idea. Some people don't believe in global warming even though over 95% of climate scientists say it is true. In the same way, the author does not explain adequately why we should return to a system that almost all economists reject.
Do you really want to have a good grasp of what is really going on? Then get this book. I have read other economics or macro economics books and some are very very good, but this book spells out the bottom of the issue. Having an understanding of the base, is a great place to start or even end up at. It's not a doom and gloom, rather an explanation of the situation we are in. It doesn't tell you directly what to do, but all these books seem to point towards the same direction.
I don't know if more pauses or a slower pace would help, but my guess is it might.
No story here, just a lot of history, facts, and prediction.
Perhaps, if current events develop that make the topic worth revisiting, but otherwise, no.
I listen to audio books while working out at the gym or on chores around the house. Some grab my attention and some just don't. I guess I gleaned enough from the narrative to get the gist of what this guy is saying and I'm not sorry I stuck it out, but there was a LOT that got past me because it failed to hold my interest in many rather long passages. I'd like to say I would listen again and try harder to pay attention because I would kind of like to better understand what the author has to say on the subject (he seems really knowledgeable), but I somehow just doubt I will. If you have an interest in this sort of thing, you'll probably find Boomerang Travels interesting, and it's so funny. I was just laughing out loud at the gym while listening to it.
I think I need to reevaluate the papers I read or how I read them.
Must totally revamp my investment review / strategy sessions.
Had no idea this stuff was going on and as I look at the data to validate the story it all seems to fit.
Wow... awesomely eye opening.
Surfer, musician, business coach, healthcare facilities management director.
The author provides a compelling description of the global financial system as a house of cards. It is hard to understand why his warnings are not being heeded by governments around the world.
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