Mostly: Classical

[amarksp]

you can't agree that currencies are manipulated...?

Explain why Japan and other Asian countries want to keep their exchange rates lower relative to the US$ to encourage exports. Why do you think Asian countries are buying so many US Treasuries, why should they recycle the US$ back to the US, why wouldn't they buy 50% of their treasuries from EC countries, Australia, and Canada?

Second, do you not think that raising and lowering interest rates is a means to manipulate currencies? How about central bank jawboning on how they "will" raise (or lower) rates to impact their currencies in the right direction and then fail to follow up with the rate move... Why jawbone at all...?

Why do certain foreign central banks (e.g. Japan) say they will defend a certain exchange rate to the US$ and then start buying dollars and selling yen like crazy to support some level they believe they can successfully defend...

You can call it "active management" if you like, but to me it is manipulation. I am not implying that such policies are bad or evil, foreign exchange stability/slower moves in exchange rates are desireable. But the Fed and foreign Central Banks are not exactly choir boys either... They generally try to manipulate their currencies to create a competitive advantage.