I notice a trend toward more regulation of various aspects of finance in Asia related to the potential inflow of US Dollars. This is in response to the Fed's announcement of the $600 billion dollar quantitative easing plan (II).
This is a dangerous development that has its origins in trade imbalances and a policy of fixed currency exchange rates.
It the world retreats from the free flow of money then the era of internationalism will take a serious blow. This is to the detriment of global economic growth.
Countries that rely on a fixed exchange rate and a perpetual, favorable balance of trade are growing their economies at the expense of others. This is not a sustainable policy and will lead to increased tensions in the world.
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