The Traderszone Network

Published in TZ Latest News 4 July, 2015 by The TZ Newswire Staff

Don’t bet against the Danes

One of the important tenets of market monetarism is that countries with their own currency can can control their nominal exchange rate.  This means there is no such things as a “liquidity trap”; a country can simply depreciate its currency if it wishes to create inflation.  Switzerland did this in 2011 and held the exchange rate at a depressed level for more than three years.  But then the Swiss National Bank let the currency float higher, for reasons that still are not entirely clear.

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