Quote:
Originally Posted by Jesus H Christ
Don't be fooled. The Chinese have grossly undervalued their currency to stay competitive in world markets for products and services.
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There are many reasons for this - and among them is the fact that around 56% of China's imports are to foreign-based businesses investing in China. These same businesses also make up 54% of China's exports. China is valuing investors in China and retaining a healthy global trading environment for them.
A fair number of the businesses who have invested in China are US owned and these corps return profits to the US, and, like all of China's global trading partners, the US gets the benefit of cheap product.
Sure... aware the US government is complaining about "undervalued currency" and trying to get China to change it's economic plans - mainly due to a $233 billion trade deficit with China. Change is probably unlikely - China has other factors than US trade to consider.
The reality is consumption within the US is excessive when you consider that country only has 5% of world population. (It's the same with oil where that 5% population consume 50% of the world's oil production.) China is already supplying cheap product and contributing to corp profits within the US. Asking for more is like draining blood. There is nobody forcing any nation to buy from China - they can manufacture in their home country (and in the instance of the US, decrease that trade deficit), but - it's too easy to buy products generated from cheap labor. No?
