Yesterday we looked at the first short video of 7 that explains why interest rates are so low. The effect comes from the global currency markets and, in my vie, is an effect that hasn't been fully appreciated by investors - even very sophisticated investors.
Today's Khan Academy 14-minute video shows, in very basic terms, how freely varying exchange rates eliminate trade imbalances. Notice especially, at the end, how prices in the countries change.
Again, this is leading to a fairly sophisticated understanding of the impact of controlling exchange rates and demonstrates that the economics investors need to understand can be presented without esoteric mathematics.
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