Currency Wars and A Possible Self-Defense (I): How Currency Wars Take Place

Abstract

Going along with the common knowledge that money can easily destroy a person, a family, and a healthy business enterprise, this work investigates the nature of currency wars in two parts. The first part shows, by making use of the systemic yoyo model and Bernanke-Gertler model of fundamental value of capital,how money can be purposefully and strategically employed as a weapon of mass destruction. Based on how a currency war could be potentially raged against a nation, the second part of this work makes use of the results of feedback systems to develop a self-defense mechanism that could conceivably protect the nation under siege.