How does this make sense? I always want the currency I have to increase in value, not decrease. Does anyone actually like it when their savings lose value and they can no longer afford things they used to? Sure it helps exporters export more stuff, but they're getting paid with more worthless money so what's the point?
It makes sense when you have debt instead of net savings. And it makes sense when your consumables are local, but you export internationally, so now your foreign customers can afford to buy more.
IMHO if the government is going to put its finger on one side of the scale or the other, it makes more sense to punish people who keep their money in their mattress and don't invest it.
When you see your bank proudly advertising 1.9% rates on 60-month CDs, you know it's time to take some risks with your money... the kind of risk-taking that grows the economy.
I've asked this question few times. If you devaluate by 10%, your export must go up by 10% to break even or otherwise it would be foolish move. Will exports always go up in proportion? Will we all be start buying more Chinese goods because they are 2% more cheaper? I think it's all speculation. Economists are basically trying out all the knobs at their disposal to see if it works and if it doesn't then they will rollback the change in a month or two. The general wisdom that devaluation helps exports makes sense only when market has room to grow by falling prices.
Welcome to the fiat monetary system. The current monetary policy is to have your currency lose value every year. If you don't want your savings to lose value, save in something else, e.g. gold, stocks, real estate.
Right.... you keep telling yourself that. Overall, yes, keep money in investments. But don't speculate on Gold, its one of the worst performers of all time.
Gold prices, like many asset prices, are manipulated openly and secretly by major organizations like central banks.
When people buy gold, it's not because they think the manipulated price is worthwhile, it's because they believe it is intrinsically mispriced and are betting that there will be a price correction at some point.
I mean, can you look at this stock market which has miraculously doubled since 2008, all while the federal reserve has pumped trillions into asset purchasing, and believe our equity and asset markets aren't being heavily influenced by state level actors?
Holding anything more than 5 oz of gold was illegal between FDR and Nixon.
Nah man, Gold ain't worth it. Historically it has been seized by the State, and in "modern times" (after Nixon rescinded EO 6102) it's price has been horribly irregular and subpar other investments.
Even lowly Bonds have better long-term investment value.
