What are the implications of a devalued dollar? If you ask economists at the U.S. Treasury and Fed, debased money will stimulate exports since non-dollar currencies will buy more of U.S. goods priced in cheapened dollars. Others will say that the devalued money will cause individuals to spend more, thus “stimulating” the consumption that allegedly drives economic growth.
The above is a loud example of how near-sighted economists are. They seemingly can’t see beyond what is right in front of them. Because they can’t, they’re blind to the much more hazardous implications of a policy – currency devaluation – that has always worked in the models designed by economists untouched by the real world, but never in practice.
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