Tuesday, November 13, 2012

Richard Duncan quotes

“Before 1971, currencies were pegged either directly or indirectly to gold. Therefore, there was nothing to be gained by creating fiat money in order to buy any other country’s currency. When the fixed exchange rate system ended with the collapse of the Bretton Woods system, however, that changed. Gradually, it became apparent that a country could gain an export advantage if its central bank created fiat money and used it to buy the currencies of its trading partners.”

“Fed Chairman Ben Bernanke blamed the flood of foreign capital entering the country on a global savings glut. That is nonsense….The glut that inundated the United States was a glut of fiat money created by central bankers intent on manipulating their currency in order to boost their countries’ exports.”

“Never before has a country incurred current account deficits on the enormous scale that the United States has experienced in recent years. The reason the dollar does not depreciate enough to correct the U.S. trade deficit is because many of the countries that the United States trades with are manipulating the currency’s value by creating fiat money and buying dollars.”

“While fiat money created for this purpose is not solely responsible for bringing about the global economic crisis, it has been one of the leading culprits.”

–Richard Duncan, The New Depression