Washington unhappy with Chinese devaluation of the Yuan

myp · Mar 16, 2010

Congress and the Obama administration are starting to express further anger towards the Chinese for artificially keeping the value of the Yuan low. A bill proposed in the Senate seeks to place higher tariffs on Chinese exports and the Obama administration has called China a currency manipulator. There is no doubt that China has artificially kept the Yuan down, but what the reaction should be is arguable.

Any thoughts?

reference: http://www.reuters.com/article/idUSTRE62E2VC20100317

deanhills · Mar 16, 2010

I'm confused. I though a low Yuan would make the US happy, as a higher value Yuan would increase the cost of repaying the US debt, which is quite huge?

Dirk · Mar 17, 2010

deanhills said:
I'm confused. I though a low Yuan would make the US happy, as a higher value Yuan would increase the cost of repaying the US debt, which is quite huge?

Nah, it will make exports easier for China. America wants to avoid a mass influx of Chinese goods.

The US has been pushing for heightening the value of the yuan for a while.

myp · Mar 17, 2010

Deanhills, there is certainly some conflict in interest even within the US as on one hand, a stronger Yuan might make it easier for American goods to compete and with the current unemployment some politicians think that is the answer. On the other hand though, the weakening of the Yuan is often tied to China buying USD, which of course is needed to fuel our debt.

chuck schmidt · Mar 17, 2010

Stamp its feet all America wants, there is good reason to suspect that the torch of world supremacy is passing from the west to Asia. All the foot stamping in the world won't change that.

deanhills · Mar 17, 2010

chuck schmidt said:
Stamp its feet all America wants, there is good reason to suspect that the torch of world supremacy is passing from the west to Asia. All the foot stamping in the world won't change that.

Maybe this answer is the same as MYP's "yes" and "no", mixed. The US are miles ahead of Asia in many important aspects. If not, Asia would never regard it as seriously as it does. The Chinese may be ahead in flooding the whole of the world, not only the US, with cheap goods and services, and undercutting prices for international construction and engineering projects, but it still has a very far way to go to catch up with the sophistication and expertise of the US.

chuck schmidt · Mar 18, 2010

deanhills said:
Maybe this answer is the same as MYP's "yes" and "no", mixed. The US are miles ahead of Asia in many important aspects. If not, Asia would never regard it as seriously as it does. The Chinese may be ahead in flooding the whole of the world, not only the US, with cheap goods and services, and undercutting prices for international construction and engineering projects, but it still has a very far way to go to catch up with the sophistication and expertise of the US.

Yes, but that is not what I meant. China is a sun rising, the west is a sun setting.

deanhills · Mar 19, 2010

chuck schmidt said:
Yes, but that is not what I meant. China is a sun rising, the west is a sun setting.

China may destroy itself before its sun can rise when the sun in the West is setting. Its present world economy offensive in an attempt to dominate the world trade markets is so enmeshed with the "sun setting" West, that if the sun sets in the West, then the China sun in the East would have to set as well.

chuck schmidt · Mar 19, 2010

deanhills said:
China may destroy itself before its sun can rise when the sun in the West is setting. Its present world economy offensive in an attempt to dominate the world trade markets is so enmeshed with the "sun setting" West, that if the sun sets in the West, then the China sun in the East would have to set as well.

Kind of like two buck deer dead of starvation with their antlers locked? Maybe, but when Britain sank the US did not sink with it. Between China and India there are over 2.5 billion people and short supply lines. Methinks they can survive without Coca Cola and MacDonalds.

Dirk · Mar 19, 2010

chuck schmidt said:
Coca Cola and MacDonalds.

Speaking of which, have you read (George) Ritzer?

deanhills · Mar 19, 2010

chuck schmidt said:
Kind of like two buck deer dead of starvation with their antlers locked? Maybe, but when Britain sank the US did not sink with it. Between China and India there are over 2.5 billion people and short supply lines. Methinks they can survive without Coca Cola and MacDonalds.

No, the US did not sink with Britain, as the US was building a completely new economy based on WWII. China's economy is not separate from the world but completely interwoven. If the US should become unable to repay its debt to China, China would be in serious trouble.

chuck schmidt · Mar 20, 2010

Dirk said:
Speaking of which, have you read (George) Ritzer?

No. What'd he write?

Dirk · Mar 20, 2010

chuck schmidt said:
No. What'd he write?

Sociological aspects of globalisation. Back in the 90s, he wrote a brilliant peace about "McDonaldization".

chuck schmidt · Mar 21, 2010

Dirk said:
Sociological aspects of globalisation. Back in the 90s, he wrote a brilliant peace about "McDonaldization".

Ahhhhhhh, aid to the Chinese Armed Forces. Boogey & flies.

Washington unhappy with Chinese devaluation of the Yuan

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