With all this talk of “competitive devaluation” in the currency markets there is something we really need to worry about: the return of mercantilism. Competitive currency devaluation is nothing more than modern day mercantilism. The rationale is the same and it leads in the same self-defeating direction. The best aspect of international trade must never be forgotten: buying stuff from foreigners for cheaper than we can make them, and selling stuff to them for cheaper than they can make them. Competitive devaluation is a road back to the bad old read more…