Cooking the Books: Death of a currency (2025)

The Cooking the Books column from the October 2025 issue of the Socialist Standard

‘Local currency is retired to end a notable trend’ reported the Times (1 September) about the demise of the Lewes Pound, a local currency introduced 17 years ago in the Sussex town and copied in various other towns and cities in Britain.

We mentioned its launch at the time (Socialist Standard March 2009) and the extravagant claims made for the local currency by George Monbiot: ‘It by-passes greedy banks. It recharges local economies and gives local businesses an advantage over multinationals’ .

The aim was to encourage people to spend their money locally by using a currency that could only be spent and circulated in the town concerned. If people used the local currency to buy from a local shop, it was argued, it would stay in the town, but that if they used ordinary money to buy from a national supermarket the chances are that it would end up being spent elsewhere.

Local currencies didn’t replace ordinary money. In fact, they had to be backed pound for pound by an equivalent amount of ordinary money deposited in a bank. The Times refers to this in its report when it says that, now that the scheme is being wound up, ‘the backing money will be donated to four local charities’.

As we mentioned at the time:

‘The Lewes Pounds get into circulation by people buying them for ordinary pounds and are convertible back into pounds on demand. In answer to the question “What happens to the sterling pounds that are taken when people buy Lewes Pounds?” the organisers explain: “All Sterling pounds are held in a safe deposit box with a local bank, so that we can access them at any time should people wish to trade their Lewes Pounds back into Sterling”’.

So no by-passing of ‘greedy banks’. Nor any extra purchasing power introduced to boost the local economy. It was just one piece of paper being replaced by another of equal spending power. Since people wanting to use the local currency had to buy it, those doing this were likely to have been enthusiasts who would have bought things locally anyway using ordinary money; the same goes for those accepting it in change (which people couldn’t be obliged to do). It is unlikely, then, that local businesses benefited — except the scheme itself by selling Lewes Pounds to collectors. How multinationals lost out remains a mystery.

The scheme failed in the end due to the nationwide trend to pay by card rather than cash. In Brixton the organisers of the local currency there tried to get round this by introducing an electronic Brixton Pound  but this too was overtaken by smartphones with their electronic wallets, and the Brixton Pound too was wound up.

When the Brixton Pound was introduced in 2009 our South London branch commented in a leaflet distributed in the area:

‘What’s the point (apart from helping local shopkeepers)? What difference does it make what coloured pieces of paper we have to use to get the things we need to live? The real problem is that in present-day, capitalist society we have to use money at all to obtain these, and that the amount of money we have will always be rationed by what we get as wages or as benefits. That restricts and distorts our lives’ (Th£ Brixton Pound — What For?).

The sad fact is that all the enthusiasm, time and voluntary work that went into devising and running local currencies led nowhere. This particular ‘notable trend’ to do ‘something now’ to try make things better under capitalism made no difference whatsoever.

50 Years Ago: Floating to nowhere – the currency chaos (2023)

The 50 Years Ago column from the August 2023 issue of the Socialist Standard

If of course the dollars were convertible into gold at $35 an ounce as they used to be, nobody would fear to hold dollars. At present the dollar and pound are described as ‘floating’. All this means is that instead of being devalued and immediately fixed at the lower level they were devalued and allowed to fluctuate about the lower level.

The pound was devalued in 1967 by the Wilson government and again in 1971 by the Heath government — on the latter occasion with the enthusiastic support of Tories, Labour and the trade unions on the ground that it would make exports cheaper to foreign buyers and thus encourage production for export. The other side of the coin is that devaluation makes all imports correspondingly dearer. So the Labour Party and trade unions which protest against the higher prices of imported goods are protesting against the inevitable result of an action they approved of.

The governments and capitalists are becoming aware of the fact that while the depreciation of currencies may seem to be of short-term advantage, at least to exporters, the competitive depreciation of currencies such as the dollar and pound creates a chaotic situation which may make all international trading operations more difficult. This is leading some capitalists and economists to see that in the long run capitalism will have to re-learn the need to have stable currencies and that there is no better way than to restore gold convertibility at a fixed rate, in short the end of inflation.

And what does this offer to the workers? In nineteenth-century British capitalism there was no inflation. Prices in 1914 were actually slightly lower than in 1814. In between, prices rose moderately in booms and fell in depressions. And what the workers got was exploitation and poverty all the time, relieved somewhat in booms and worsened in depressions, with unemployment similarly.

Nobody has produced — or will produce — any policy which will change the nature of capitalism. Those who really do learn the lesson of history will concentrate on getting rid of capitalism.

(From the article 'Floating To Nowhere — the currency chaos' by Edgar Hardcastle, Socialist Standard, August 1973)

Correspondence. "The Traveller's Return." (1921)

Letter to the Editors from the April 1921 issue of the Socialist Standard

To the Editors. 

Sirs,—

I must admit being still unconvinced by F.F.'s reply to me in the November issue. He says I "completely fail to show why they are so exchangeable (sovereigns for paper currency) if the note does not represent the sovereign." Whilst one would have thought that the very fact that in a less restricted market than at home—the restrictions of the market being due to penal laws operating against the use of sovereigns other than as currency—it is customary to offer and receive more than the face equivalent for gold in exchange for notes, would be at least a colourable imitation of a "show" if more proof be required than the cases I have cited— assuming them to be true, which can easily be proved.

It may help to remind F.F. that before the war gold stood at £3 17s. l0½d. per oz. and the figure just now is about £6 2s. 4d. with the same amount of gold contained in the sovereign as at the lower figure ; which means, obviously, that the actual value of the sovereign as gold at the present time is at least 34s., and that would be the price obtainable here if it were not for the severe penalties fixed by law for using sovereigns for the gold contained in them instead of as currency.

If the functioning of our gold standard is so automatic as F.F. contends, why is it necessary for the authorities to impose penalties in order to prevent the free use of gold as a commodity as distinct from its functioning as currency ? One is aware that it is an old offence to melt down sovereigns, but previously to the war, when British currency was normal, it was an offence which was winked at, and it was not until the abnormal conditions brought about by the war arose that the law was put into active operation again in this connection. As a matter of fact, when foreign debts are being discharged in gold, sovereigns are not used as the form of payment, but bullion is used in order to ensure that the full market price of the gold is obtained ; when the currency was normal this did not matter, but now it is obviously a very big item.

The point can be somewhat clarified when it is mentioned that in Mexico the standard of currency is gold, and when the price of gold advances in any particular degree the "Mex" gold dollar is reminted in a smaller size, and the Mex dollar is now smaller in dimensions than a three-penny bit, whereas five years ago it was nearly as large as a sixpence. The same rule is adopted there with silver, so that silver coins are of a diminutive size owing to the high price of silver.

F.F. says "the differences in the rate of exchange" quoted by me "represents largely the state of government and other credits of those countries." That statement would hold good if it were not for the fact that in the localities I mentioned so much more is offered for the sovereign than is obtainable for English paper money.

I quite agree that a paper currency convertible into gold on demand cannot be inflated, but that does not alter the fact that a currency can, and is, inflated when so much paper is issued that the gold to convert it is no longer obtainable at the banks—nor even a small portion of it—and as a consequence the rates of exchange between the locality of inflation and those where the inflation has not occurred are adversely affected. What F.F. does not seem prepared to take into consideration is that it is necessary to make penal laws in order to stop folk from selling sovereigns as gold, and I repeat that if the subject were as automatic as he insists this would be quite unnecessary.

As for the note being "treated with the same respect as the sovereign," that is not the case, and I would suggest that in ninety-nine cases out of a hundred if the alternative were offered the gold would be jumped at, and if the recipient were a person who was likely to take advantage of present conditions, ere long those golden goblins would be in other hands and have assumed different shapes, and the vendor would be chuckling over the extra pieces of paper currency which had accrued to him over the transaction.

In conclusion, I must point out that my argument is not that the inflation of currency is the
cause of high prices because whilst I know that this inflation is one of the effects of the war, I
 know it is not all of them.

D. W. F.

The Answer.

D.W.F. is still unconvinced because he goes abroad to examine something that can only be explained by a close examination here. All his supposed arguments are bogies raised by himself to his own confusion. They have no bearing whatever on the subject. For instance, he harps on the fact that the sovereign will fetch more abroad than the pound note, all the while forgetting that the latter is not legal tender abroad. Notes can be exchanged for sovereigns at the Bank of England on demand. If the sovereign would buy more than the note it would be demanded. That the currency note is everywhere accepted, and sovereigns are not demanded, proves that the note is accepted as the equivalent of the sovereign. In other words, the note, being convertible, obviously represents the sovereign and not something less than the sovereign—which would be the case if inflation had taken place.

Another point that has no bearing on the subject, but which mystifies D.W.F., is the high price of gold to-day compared with the pre-war price. It has already been pointed out that gold may rise in price because of increased demand without affecting currency. In any case, inflation and a rise in the price of gold are far from being the same thing, as D.W.F. seems to think. Gold is used for other purposes than coining. The usual method of paying debts abroad is to buy up foreign bills, but if bills are at a premium it may be cheaper to export gold. An increased demand for this will doubtless send up its price, but if it leaves a margin over the method of buying bills it will be preferred. Our correspondent's mistake lies in supposing that these movements have anything to do with currency. The rise in the price of gold has taken place outside the sphere of currency as a result of competition amongst traders.

The reference to Mexico likewise has no bearing, on the subject. All it does is to show that D.W.F.'s pet obsession—the high price of gold—is universal. Apart from that, the Mexican practice only results in inconvenience, because it calls for fresh calculations and readjustment of prices with every new issue.

Again, D.W.F. speaks of so much more being offered for the sovereign abroad than is obtainable for English paper money. The latter, however, is not used for exchange purposes because bills are far more convenient. If he means by "English paper money" something other than currency notes there is no point to his contention, because such paper will be outside the ordinary currency and subject to fluctuations like gold and bills.

Next my critic talks of localities where the inflation has not occurred. Where are they? According to his own statement debts between countries are paid in bullion. Equal quantities of gold are of equal value all over the world. Bullion is the world currency for that reason, and its use as a means of adjustment between nations confines each national currency within its own borders. Therefore, to talk of localities where the inflation has not occurred is absurd. The paper money of no country, not even excepting the United States, is worth so much abroad as gold.

D.W.F. winds up by denying that his argument is that "the inflation of currency is the cause of high prices," and then declares that "inflation is one of the effects of the war" ; but if inflation exists without prices being affected there is no point to his remark. If he means the reverse of what he says, he is still wide of the truth, because it must be obvious that had notes never been issued, and instead the sovereign continued to circulate, prices would still be where they are to-day. The banks may or may not have sufficient gold to pay out likely demands—D.W.F. declares emphatically they have not; there may or may not be a shortage of gold in the country. But the fact remains that every currency note issued is legal tender for, and is guaranteed as representing the sovereign—the latter being obtainable on demand.

If the amount of gold in reserve—or in a country—had any bearing on prices, we should expect the latter to fall when gold was pouring into a country. But the reverse was the case in the United States, where prices continued to rise while gold was pouring into the country from Europe.

As D.W.F., however, agrees that "a paper currency convertible into gold on demand cannot be inflated," the question I first asked in the July "S.S." remains unanswered. Neither D.W.F. nor anyone else has been able to show that the currency of this country is inflated. Instead, our correspondent by this last admission, and by his failure to prove that the note does not represent the sovereign, fails to establish anything to the contrary. Consequently there is nothing left but to reaffirm the statement previously made, that prices are high because rings and trusts have been formed by capitalists to force prices up and keep them up.

F. Foan

Cooking the Books: The Sinking Pound (2016)

The Cooking the Books column from the November 2016 issue of the Socialist Standard

‘Hard Brexit fears push sterling to a fresh low’ read the headline in the Times (7 October) reporting that the pound had fallen to its lowest level against the dollar for 31 years. Others are suggesting that it could eventually fall, ironically, to £1 = 1 Euro.

Until 1973 most of the world’s currencies were tied to a fixed rate with the US dollar and so also to each other. If a country wanted to change this it had to get the agreement of the IMF. Governments tried to avoid such a formal devaluation as this was regarded as a recognition that they could not control the part of the capitalist economy they presided over as they had claimed in order to get elected.

Such devaluations reflected a situation where a country’s exports were doing badly, generally because their prices were uncompetitive due to a higher than average rate of inflation. This resulted in more capitalist firms wanting to sell the country’s currency than to buy it (to pay for its exports). Governments tried to hold the fixed rate by using their reserves of other currencies to buy their own currency. When this couldn’t be kept up, they had no alternative but to seek the permission of the IMF to devalue, i.e., to lower its exchange rate with the US dollar and so with other currencies too.

When the Labour government was forced to devalue the pound in November 1967 the Prime Minister, Harold Wilson, famously declared that ‘it does not mean that the pound here in Britain, in your pocket or your purse or in the bank, has been devalued.’

This was technically true but disingenuous as, while a pound would still buy a pound’s worth of goods in Britain, one effect of devaluation is to raise the price of imported goods. As many of these are consumer goods or enter into their production, the effect is that ‘the pound in your pocket’ will eventually come to buy less than before the devaluation.

Nowadays, with floating exchange rates, governments don’t need to formally change the exchange rate of their currency. They can just let market forces decide what the exchange rate is by the demand for it. Because a falling exchange rate increases the price of imported goods governments do not necessarily always want this, so they still intervene in the currency market to try to keep the rate from falling.

On the other hand, when they want to try to increase exports, they let it fall. In fact, now that under WTO rules tariffs can’t be used as a weapon of economic competition, letting a country’s exchange rate fall has become a replacement. The euro, which in effect established a fixed rate of exchange between the currencies of the member-countries all renamed “euro”, is in part an attempt to prevent this kind of economic competition. One reason Britain stayed out was to be able to continue to use this weapon.

The current fall in the value of the pound was exacerbated  by a rousing patriotic declaration by the Prime Minister at the Tory Party Conference that, with Brexit, Britain was to become an independent, sovereign nation again. To which the currency markets gave a decisive ‘that’s what you think’, illustrating yet again that no country can escape from the operation of the economic laws of world capitalism as well as reflecting the speculators’  assumption that, if Britain leaves the single market as well as the EU, British exports are likely to suffer.

Floating To Nowhere — The currency chaos (1973)

From the August 1973 issue of the Socialist Standard

The cynic who said that the only lesson of history is that men never learn from history was knowingly exaggerating, but he also had it wrong, at least in regard to the history of capitalism. A few people have learned from past crises what kind of system it is and the economic laws on which it operates. And if the crisis is big enough memory of it will last for years among capitalists and workers alike as something they would like to avoid happening again.

However, two things undermine their fears in course of time. As, in the main, neither capitalists nor workers fully understand how capitalism works they are always ready to accept new quack remedies for capitalism’s ills. And governments, always with an eye on solving the immediate problem and winning the next election, will time and time again flout past experience and simply hope that something will turn up to save them. (The Daily Mail, 10th July, which solidly backs the Government over the currency crisis, frankly admits that the Tories are simply “gambling on prosperity”.)

An interesting case in point is the German Chancellor Willy Brandt. Like others of his generation he was for years committed to avoiding a recurrence of the great German inflation of the nineteen-twenties and similar events after the second world war, but has recently declared that he would "rather have inflation than unemployment”. He need only look up the records to see that he may get both. In the ’twenties, when inflation got out of hand, nearly 30 per cent, of the workers were unemployed.

Creating Weakness

Marx, the economist whom modern economists do not want to know, pointed out certain basic facts about capitalism. The capitalist, having acquired surplus value in the form of commodities, through the exploitation of his workers, needs to turn these commodities into money. Through long and hard experience it was appreciated that in the interests of capitalists as a whole there is great advantage in having it in a stable form — either gold or its equivalent, a paper currency convertible into gold at a fixed rate.

This was how the pound became a world-accepted currency in the nineteenth century, and the dollar in this century. The purpose of the gold link was to prevent the depreciation of the pound or the dollar, and consequent rise of prices, through the excess issue of an inconvertible currency. That is now all in the past. First the pound and then the dollar became inconvertible currencies issued in increasing quantities and losing their purchasing power month by month.

It is not speculators who make a currency "weak”, but its continuing loss of purchasing power which gives speculators their opportunity. And it is not only speculators. Capitalists all over the world who have sold goods for pounds or dollars do not want to hold them because their purchasing power goes on falling. The Chairman of the Arab countries’ Economic and Social Development Fund put the point in the course of a protest against the American Government’s refusal to allow dollars paid to the Arab countries for oil, to be converted into other currencies: "Why should we produce more and then be stuck with dollars we cannot make use of? It would be better to leave the oil underground.” (Financial Times, 10th July 1973).

Cheap Makes Dear

If of course the dollars were convertible into gold at $35 an ounce as they used to be, nobody would fear to hold dollars. At present the dollar and pound are described as “floating”. All this means is that instead of being devalued and immediately fixed at the lower level they were devalued and allowed to fluctuate about the lower level.

The pound was devalued in 1967 by the Wilson government and again in 1971 by the Heath Government — on the latter occasion with the enthusiastic support of Tories, Labour and the trade unions on the ground that it would make exports cheaper to foreign buyers and thus encourage production for export. The other side of the coin is that devaluation makes all imports correspondingly dearer. So the Labour Party and trade unions which protest against the higher prices of imported goods are protesting against the inevitable result of an action they approved of.

The governments and capitalists are becoming aware of the fact that while the depreciation of currencies may seem to be of short-term advantage, at least to exporters, the competitive depreciation of currencies such as the dollar and pound creates a chaotic situation which may make all international trading operations more difficult. This is leading some capitalists and economists to see that in the long run capitalism will have to re-learn the need to have stable currencies and that there is no better way than to restore gold convertibility at a fixed rate, in short the end of inflation.

And what does this offer to the workers? In nineteenth-century British capitalism there was no inflation. Prices in 1914 were actually slightly lower than in 1814. In between, prices rose moderately in booms and fell in depressions. And what the workers got was exploitation and poverty all the time, relieved somewhat in booms and worsened in depressions, with unemployment similarly.

Nobody has produced — or will produce — any policy which will change the nature of capitalism. Those who really do learn the lesson of history will concentrate on getting rid of capitalism.

Edgar Hardcastle

International money chaos (1980)

The Briefing Column from the November 1980 issue of the Socialist Standard

A currency unit is always in the end the name for a specific amount of gold (or silver). At one time—when paper currency was convertible on demand into a fixed amount of gold—this was obvious but has now become obscured in the system of “managed currencies’’ which grew up between the wars. In nearly all countries today the currency—the actual medium of circulation—is not gold nor even a paper currency convertible into gold but inconvertible paper notes and coins. Such a currency is said to be “managed” because the amount of it in circulation depends entirely on political decisions.

Before the era of managed currencies the link between a currency and gold was always clear. A law defined the meaning of the name of the currency (pound, mark, franc) in terms of a certain amount of gold (or silver, or both). This is no longer the case but the pound and other currencies continue to represent in economic reality a certain amount of gold. Gold is still today the money-commodity, the only real money, even though it has been replaced as the medium of circulation by paper and metallic tokens.

With a managed currency a government institution (Ministry of Finance, Central Bank) has to decide how much is put into circulation. The amount of currency needed to maintain a stable price level, however, is fixed by economic factors outside of government control, such as the total amount of buying and selling transactions, debts to be settled, velocity of circulation of the currency. The government is of course free to issue more (or less) than this amount, but if it issues more then the currency will depreciate.

The effect will be the same as if, under the old system, the government had passed a law re-defining the meaning of the word pound in terms of a lesser amount of gold—which is equivalent to increasing the prices of all goods expressed in the currency unit. This—overissuing an inconvertible paper currency—is what has caused the inflationary price rises which have gone on continuously in Britain since the beginning of the last world war. Inflation (properly understood as inflating, or overissuing, the currency) means that the currency has come to be defined in terms of lesser and lesser amounts of gold.

A managed currency only has a circulation within the borders of the state which manages it. No state can enforce the use of its paper currency outside its borders, though people there may choose to accept it. Paper currencies, however, can still be exchanged with each other. What determines their rate of exchange?

What we have said about the paper pound being the name for a certain amount of gold applies equally to the other paper currencies. The paper mark and the paper franc are also names for amounts of gold, though different amounts of course. In fact up until the end of 1971 the currencies of the member states of the International Monetary Fund were declared to the Fund in terms of weights of gold. Thus if the French franc was defined as 3gm of gold and the English pound as 39gm, then the rate of exchange between francs and pounds was £1 = 13 francs. The Member states of the IMF were supposed to maintain a more or less fixed rate of exchange between their currencies and those of the other members.

Had it not been for the inflationary policies pursued by all states this would have proved a relatively easy task. But in fact all states inflated their currencies, though not to an equal extent, so that the parities declared to the IMF came to no longer correspond to the economic reality. Those countries which had inflated their currencies more than average were sooner or later compelled to declare to the IMF that their currency should now be officially regarded as representing a lesser amount of gold. This devaluation meant that the exchange rate with other currencies had altered: their currency would now exchange for a lesser amount of all other currencies. On the other hand those countries which had a below average inflation were compelled to up-value their currency, known as revaluation, as happened a number of times to the D-mark and the Swiss Franc.

A devaluation then was a recognition on the international level of a currency depreciation that had already occurred internally. This was why Wilson was in a sense right when he declared in his famous 1967 statement that devaluation left unchanged the value of the pounds in our pockets. It did, because the depreciation had already taken place before! (As the Wilson government continued the policy of currency inflation, the pounds in our pockets did in fact continue to shrink, but because of the continuing inflation of the currency rather than because of the devaluation).

At the end of 1971 the IMF system of fixed parities, with periodic devaluations and revaluations as necessary, broke down. Instead countries just let their currencies float. What this means is that an internal depreciation of a currency resulting from its inflation is now immediately reflected in its rate of exchange with other currencies instead of building up towards an eventual devaluation.

Some countries link their currencies to others, agreeing that they will not let their currencies fall or rise above or below a certain margin compared with the other currencies in the system. One such system was the famous “snake” of European currencies, of which Britain was a member for a short while. The European Monetary System (EMS) is another such system.

For such systems to work each of the states involved has to have more or less the same rate of inflation. For if one state had a greater rate of inflation than the others, then its currency would tend to fall below the lower limit and in order to maintain itself in the system it would have to use up its reserves to buy its own currency so as to maintain its price (exchange rate with the others). The EMS does provide for the establishment of a special fund to help states in difficulty but its clear aim is to try to keep inflation rates down to the German level.

The last Labour government, presumably anxious to have a free hand to continue inflating the pound as it wished, refused to give an undertaking to keep inflation down that much and so Britain didn’t join. The present Conservative government has announced its intention to join, but is waiting for the time when (if!) the rate of inflation in Britain is at a more internationally acceptable level.

All these “systems” in the end are just makeshifts since none of them openly recognise that the only real money in the world today remains gold. Capitalists are more realistic—which explains the rise in the price of gold, and why it likely to keep on rising: nobody wants to be left holding worthless paper money as the international monetary system staggers from crisis to crisis.

Adam Buick

Cooking the Books: Currency wars (2010)

The Cooking the Books column from the December 2010 issue of the Socialist Standard

“More than a dozen countries”, the (London) Times (11 November) reported, “have been intervening in the foreign exchange markets to weaken their currencies and protect exporters, raising fears of a rerun of currency wars that damaged the world economy in the 1930s.”

The 1930s – that’s the spectre currently haunting those in charge of trying to run capitalism. Then, faced with the contraction of world trade, states tried to grab as much as was left by resorting to protectionism, export subsidies and devaluations. The conventional wisdom is that this only made things worse, deepening and prolonging the depression.

The World Trade Organisation (WTO), and its predecessor GATT, have made it difficult for states to adopt protective tariffs and export subsidies. So, all that’s left, to try to get the better of their rivals (and it’s a war of each against all), is to devalue their currencies.

Strictly speaking, since the collapse in 1971 of the Bretton Woods agreement, which had laid down fixed exchange rates between currencies, the sort of formal devaluation that the Labour governments of the 1960s were forced to carry out no longer occur. Currencies now “float”, which means that their exchange rate with other currencies is determined by supply and demand on foreign exchange markets.

Normally (if there’s a level playing field) what would happen is that the more a state exported the higher would be the demand for its currency due to those buying the exports having to acquire some to pay for these. This would lead to the currency’s exchange rate rising; which would make its exports more expensive. Similarly, a state with a balance of trade deficit would find its currency’s value fall; which would make its exports cheaper. So matters would be more or less self-regulating.
That’s the theory. The real world is rather different, since governments can influence the exchange rate of their currency by affecting the supply and demand for it. If they want to keep its exchange value low (so as to encourage exports by making them relatively cheaper) they can increase the supply on foreign exchange markets by themselves selling more there (printing more if necessary). Which is what has been happening:

The US points the finger at China but China is not the only state trying to grab a bigger share of world trade in this way. One of the main reasons why Britain didn’t join the euro was that this would have prevented it letting the pound float downwards to encourage exports. The US too has recently been increasing the supply of dollars (via “quantitative easing”) with this end partly in view as a means of putting pressure on China to upvalue the yuan.

The matter was the main item of the agenda of the G20 summit in Seoul in November, but all that was agreed was to adopt a pious declaration condemning “competitive devaluations” and wishing for “market-determined exchange rates”. Some sort of agreement may eventually be cobbled together. But maybe not. The competitive struggle for profits built-in to capitalism has already prevented agreement on a further round of tariff reductions, let alone on what to do about the threat of climate change.