I foresee a race to the bottom where most countries try to debase, debauch and devalue their own currency faster than other countries until somebody cracks. What i am saying is that China shows signs of cracking. Japan has already begun the process of cracking, because they have a 30 year head start in the process.
Since 2008 *everyone* has been devaluing their currency. But its not competitive devaluation, it's co-operative devaluation, an open conspiracy of central banks. By co-ordination they avoid excessive relative slippage, which avoids most of the political problems with inflating away debt -- the rest are solved by simply funneling money to the principal debtors. The ECB, because of its nominal mandate, has a really hard time monetizing debt on its own, but it can accomplish this through the back door by coordinated easing. I don't know what is the quid pro quo they are giving to the U.S., but I'm sure the tab will come due sooner or later. This kinda, sorta works as long as all the majors are co-operating. It has been brutal for emerging markets, and it may fall apart if one of the majors defects badly, but it does kick the can another lap down the road.