The Americans did not go down without a fight. Tim Geithner countered that the real source of imbalances in the world economy was not US monetary policy but the mercantilist trade policies of China and Germany. The Fed was not deliberately depreciating the dollar. It was targeting domestic conditions, not the exchange rate.84 If others wanted to prevent their currencies from appreciating, all they had to do was to match the Fed’s low interest rate policy with an expansion of their own. What the critics dubbed a “currency war” could thus have been turned into a comprehensive program of monetary
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