In a new report, HSBC Global Research analyst Stephen King discusses why the global currency wars in recent years have been completely unproductive. According to King, expecting the same positive outcome from currency devaluation that occurred in the 1930s in the modern global economy is absurd.

The 1930s

In the 1930s, global economies removed currencies from the gold standard and freed countries to generate impactful monetary stimulus for the first time. This monetary revolution quickly turned the deflationary environment into an inflationary environment.

“This led to lower real interest rates, reduced real debt levels, alleviated bankruptcy risk and helped boost economic activity,” King explained.

Modern Currency Wars

King noted…

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