Ben Bernanke: Currency Manipulator

The dollar is our currency, but it's your problem.
—U.S. Treasury Secretary John Connally, 1971

In the final televised presidential debate, Mitt Romney promised that if he is elected on Nov. 6 he will "label China a currency manipulator" on "day one" of his presidency. He also pledged to pay more attention to trade with Latin America, noting that the region's "economy is almost as big as the economy of China."

To be consistent, Mr. Romney should call out the Federal Reserve on day two for engaging in its own currency manipulation by way of "quantitative easing," which undermines the value of the dollar relative to Latin American currencies. After all, no one can expect a healthy trade relationship with the region if the Fed is goading U.S. trading partners into competitive currency devaluations.

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