World Policy Institute and Idealist present:
Is There a Global Currency War?
A Political Salon with Constance Hunter
Moderated by Ann Lee
This event is by invitation only.
With special thanks to the Heinrich Böll Foundation for supporting the Political Salon.
Ever since Brazil's finance minister, Guido Mantega, declared in September 2010 that an 'international currency war' had broken out, global rhetoric about monetary policy and exchange rates has become increasingly heated. The problem stems from a two-speed world where slow-growing developed countries are keeping interest rates low to stimulate growth, causing hot money to flood many emerging markets where interest rates are relatively higher. The value of developing-country currencies, like Brazil's real, rise to a level that many developing-country citizens feel is uncompetitive for exports, while simultaneously causing unwanted inflation in the domestic economies. With profligate European countries struggling to get out from under debt loads, China and Japan have agreed to buy European debt to prevent a liquidity crisis. This keeps European interest rates low and the euro weak, adding to the backlash of current reserve currency regimes. At the same time, more and more countries are echoing the US concern that China's pegged exchange rate keeps the value of the renmimbi low and gives Chinese goods an unfair trade advantage. Brazil, for example, recently raised tariffs on toys to 35% with the hopes of halting cheap Chinese imports.
In this Political Salon, Constance Hunter and Ann Lee discuss whether there really is an international currency war. Will controversial currency and trade maneuvers escalate? How can we tell if a country's monetary policy is "fair"? In a system where a major player has a fixed exchange rate, how does this distort the playing field for countries with floating rates? What, if anything, can the G20 or other multi-national organizations do to dissipate these conflicts?
About the Speakers
Constance Hunter is Managing Director and Chief Economist at Aladdin Capital, where she identifies turning points for economies or markets. Before joining Aladdin, she was chief economist with Galtere Ltd., a global macro hedge fund. She also was Managing Member and Chief Investment Officer of Coronat Asset Management, where she identified macro themes and invested in global equity and foreign-exchange markets. Prior to founding Coronat, she was a Partner and Portfolio Manager at Quantrarian Capital Management, a hedge fund that invests in Asian markets; a portfolio manager at Salomon Smith Barney and Firebird Management; and an economist at Chase Manhattan. Ms. Hunter holds a Bachelor of Arts from New York University and a Masters of International Affairs from Columbia University. Ms. Hunter is a regular guest on CNBC and Bloomberg TV and has been quoted in the Financial Times, Wall Street Journal, Barrons and The New York Times, among others. She is a Chair of the International Roundtable of the National Association of Business Economics (NABE).
A Senior Fellow at Demos, Ann Lee focuses on global economics and finance issues, and is writing a book on U.S.-China relations. A former investment banker and hedge fund partner, she is a frequent media commentator on economic issues. She has been interviewed on Bloomberg, ABC, CBS, CNN, and NPR. Her op-eds have appeared in such publications as The Financial Times, The Wall Street Journal, Newsweek, Businessweek, Forbes, and Worth. She has been quoted in hundreds of publications, and is a regular speaker at numerous industry and academic conferences. Ms. Lee is also an adjunct professor of economics and finance at New York University and a former visiting professor at Peking University, where she taught macroeconomics and financial derivatives. She was educated at U.C. Berkeley, Princeton University's Woodrow Wilson School of International Affairs, and Harvard Business School.
About the Political Salon
The Political Salon – organized by Steve Sokol since 2003 to promote dialogue among the next generation of leaders in business, policy, and the media – regularly convenes a diverse group of young professionals to discuss a range of foreign policy issues and global affairs. Attendees are diverse in terms of nationality, profession, and political persuasion.