To which Iâd add that the test of a first-rate capacity for empathy is the ability to hold two opposed positions in mind at the same time and still retain the ability to think for yourself. Shoe-shifting, the ability to put yourself in the other guyâs shoes is a fundamental skill of extraordinary power. Itâs almost as magical as shape-shifting in fantasy in sci-fi. Itâs the scientific method applied to social life.
How it works/Example: A currency is considered devalued when it loses value relative to other currencies in the foreign exchange market. A currency 's devaluation is the result of a nation's monetary policy.A central bank can make the conscious effort to make its currency less valuable.f Country XYZ's currency is set at a fixed exchange rate of 2:1 to the U.S. dollar and, due to a weak economy, XYZ cannot afford to pay the interest rate on its debt outstanding, XYZ may devalue their currency. This means the central bank of XYZ will declare their fixed exchange rate to be 10:1 to the U.S. dollar.
THE opening paragraph of Bloomberg's news story on Venezuela's currency move is a classic example of what devaluation actually means. Venezuelans lined up to purchase airline tickets and TVs this weekend in a bid to protect themselves from price increases after ailing President Hugo Chavez devalued the bolivar for a fifth time in nine years.