Re:Economist Bob Mundell has died
by pydry on Tuesday April 06, 2021 @01:35PM
(#26714883)
Capital controls are controls what kind of capital can enter and exit the country and when - e.g. transaction taxes or exchange controls (limiting how much currency you can buy or sell).
Currency pegs are when the government tries to maintain a particular value against another currency. E.g. maintaining a $ peg by buying or selling US treasuries on the open market.
They are not the same thing at all.
Currency pegs should probably additionally be separated into two groups, as, well - "too high" (UK and Thailand) and "too low" (China).
Currency pegs are when the government tries to maintain a particular value against another currency. E.g. maintaining a $ peg by buying or selling US treasuries on the open market.
They are not the same thing at all.
Currency pegs should probably additionally be separated into two groups, as, well - "too high" (UK and Thailand) and "too low" (China).
The crisis could be characterized as an attempt to adhere to the impossible trinity: https://en.wikipedia.org/wiki/Impossible_trinity