Talk, like a devalued currency, is cheap.

Pity the poor Gulf finance minister. Pressed weekly, if not daily, on when his country's currency will depeg from, or revalue against, the dropping dollar, he ceaselessly answers that the peg is here to stay. His comments are recorded, but no one believes him.

Any armchair economist can see importing the monetary policy of the recession-threatened US into the booming Gulf is a recipe for inflation. But what can our hassled finance minister do? If he said otherwise - that his country was seriously considering dripping the peg - the markets would go crazy and speculators would bet against the current rate.

Whatever he says, the market hears only what it wants to hear.

Youssef Hussein Kamal, the Qatari finance minister is the latest to trot out the 'peg stays' line. He says it is needed if the Gulf states are to hit a 2010 deadline for currency union. "There is no revaluation ... it is as it is," he said this week.

He might like to think it is as it is, but it isn't. Speculation - like inflation - cannot be solved with statements. It needs action.