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Discussion » Statements » Rosie's Corner » How do countries MANIPULATE CURRENCY? By printing money? Don't we already do that anyway?
RosieG

How do countries MANIPULATE CURRENCY? By printing money? Don't we already do that anyway?

Posted - May 14, 2019
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Responses


  • 6023
    That's one way.

    Another way is to set the exchange rate.
    You can say "our money is worth {x} US Dollars" ... and that is the exchange rate within your borders, no matter what the "real" rate is in the rest of the world.

    Another way is to buy another country's currency to affect the value of your own.
    https://en.wikipedia.org/wiki/Currency_intervention This post was edited by Walt O'Reagun at May 14, 2019 8:43 AM MDT
      May 14, 2019 7:54 AM MDT
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  • 113301
    Thank you for your helpful reply Walt. Doesn't it bite you in the a** at some point?  And we TELL other countries what our money is worth in their borders? WHOA. Well I've never traveled abroad or anywhere I'd need to know about exchange rates of foreign currency. Can countries conspire with one another to do that? That is very scary. :(
      May 14, 2019 8:02 AM MDT
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  • 6023
    I think you misunderstood.
    When a country sets the exchange rate, that is only within their own borders.
    The Soviet Union used to do that, I believe.  
      May 14, 2019 8:59 AM MDT
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  • 113301
    I just read what you wrote and now I am very confused. So who tells the country the exchange rate "in your borders". Who is YOUR? Us or the country?. Sorry to be so  obtuse but your words as stated are confusing me. Thanks. This post was edited by RosieG at May 14, 2019 9:16 AM MDT
      May 14, 2019 9:15 AM MDT
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  • 6023
    Example:
    The USSR used to set the exchange rate for their currency.
    That rate was only valid in the borders of the USSR.

    If you exchanged US Dollars for Rubles in the USSR ... you had to do it at their exchange rate.
    If you did the exchange anywhere else ... you got the global rate.
      May 14, 2019 9:44 AM MDT
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  • 13277
    Remember Econ 101 in high school or college? That's one way of increasing or limiting the money supply to stimulate the economy.
      May 14, 2019 8:02 AM MDT
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  • 44736
    Yes...we print money. I's just not covered by the income from taxes and bonds etc.
      May 14, 2019 8:45 AM MDT
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  • 113301
    I KNOW we print money E. But isn't there a system to it controlled by the FED? Didn't Venezuela send their economy down the toilet by doing that? Didn't inflation skyrocket over night by a zillion percent? I dunno. It seems to me that all the norms we are used to are being destroyed purposely purposefully. Systematically. Thank you for your reply.
      May 14, 2019 9:03 AM MDT
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