Quote Originally Posted by lucy View Post
Also, devaluation isn't only a bad thing. Exports profit. Paying debts gets easier, too. Traveling abroad, though, gets more expensive.
Which is why one of the bones of contention with China is their artificial depreciation of their currency. Of course, travel abroad is not a priority for their government.

It's also one reason the Southern members of the euro are having such troubles. Normally, one of the consequences of an economic crash like theirs would be a massive fall in their currency value, which would help their recovery by boosting exports and discouraging imports; but that's not an option.

Too much pride in the value of your currency goes before a fall, as the Thatcher government discovered when they nearly bankrupted the Treasury trying to support the GBP above the market's valuation.