Friday, Jul 10, 2009
It's all David Van Day's fault.
Telegraph: China criticises Dollar
The discussion, which took place between the leaders of five emerging economies and the G8 industrialised nations, including Barack Obama, caused concern among western leaders.
Posted by devo @ 09:05 PM (921 views) Add Comment
9 Comments
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1. tyrellcorporation said...
Showing you age there Devo, LOL! ;)
2. Tyrellcorporation said...
'your'
3. tyrellcorporation said...
'your'
4. mander said...
It should have been the other way arround, US criticizing the Chinese currency but the media job of devaluing the dollar seems to work fine
5. devo said...
It's a China Crisis.
Are you 'avin that, tyrellcorp.?
6. uncle tom said...
China's problem is that they have too many Dollars, to the extent that if they try to offload them, the value of the Greenback will nosedive as they do so.
But if they maintain a currency peg, to preserve the relative value of the Dollar to the Yuan, they will simply preserve the trade imbalance between the US and China, and amass more and more Dollars.
They made a big strategic error (fuelled by a desire to tame Uncle Sam..) by allowing the trade imbalance to arise in the first place, and would have done better to have allowed the Yuan to rise in value as their economic growth outstripped that of the US. That would have dampened their GDP growth rate a little, but given that they have had GDP growth topping 10%, some cooling would have been prudent.
I think they will have to accept that their existing Dollar assets have a true worth that is much lower than their nominal worth, and realise the need to focus their attention on the avoidance of further acquisition.
That requires the Yuan to rise in value, which in turn will stoke inflation in the west.
7. Ob2002 said...
The crime of the debt laden fiat currency we currently have coupled with fractional reserve lending is the biggest fraud in history.
8. stillthinking said...
Quite so. I don't have any sympathy for China. The one suggestion China never makes is to actually spend the dollars on US production, and they have manipulated their currency for many years, or I should say manipulated the value of Chinese workers, hardly a rich group.
9. happy mondays said...
Devo, you need to whip it ..