China’s currency manipulation is now a real problem for both the US and the People’s Republic, and the US Congress should make some effort to press China on this issue; however, the current plan to place tariffs on Chinese exports if they do not revalue will trigger a debilitating trade war. ++ The US has no leverage because of overconsumption and a lack of savings, planning, and
... More
China will likely be labeled a “currency manipulator” in the upcoming US Treasury report on foreign currency arrangements. ++ This label could carry a greater diplomatic than economic cost, potentially leading to a trade war. ++ Congress is putting pressure on the Treasury to adopt the label after China’s 2008 decision to re-peg to the dollar. ++ The administration believes in
... More
