Chinese May Strengthen Yuan
OPS_admin | Feb 27, 2010 | Comments 0
China, for years, has pegged its yuan to the U.S. dollar with the intent of always propping our currency up while holding the domestic currency down.
For many years the United States has seen its trade imbalance with China balloon. According to the United States Census Bureau, the U.S. had a $6 billion annual trade deficit with China in 1985. During the course of the next 24 years that deficit has grown almost every single year. In 2009 the total stood at $226.8 billion, that figure is expected to decrease slightly in 2010 but it will still likely be in the range of $200 billion or more.
The explanation for our trade deficits with Mexico and Canada are relatively simple, we import costly oil from these countries and NAFTA allowed us to ramp up outsourcing of manufacturing to their markets. If you took oil out of the equation we would still carry deficits with them, but they would be much smaller.
However, our deficit with China involves zero oil effect, it is all related to our demand for Chinese exported consumer goods.
Full Story: Chinese May Strengthen Yuan | Economy In Crisis.
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A new report by the Royal Society, chaired by Nobel prize-winning biologist Sir John Sulston warns that world population must be stabilized and consumption in wealthy nations must be reduced or the entire planet is in big trouble. As the report reads: "The number of people living on the planet has never been higher, their levels of consumption are unprecedented and vast changes are taking place in the environment. We can choose to rebalance the use of resources to a more egalitarian pattern of consumption... or we can choose to do nothing and to drift into a downward spiral of economic and environmental ills leading to a more unequal and inhospitable future."This is the same warning that President Jimmy Carter gave Americans back in the 1970's - but it was ignored when Ronald Reagan came to power with a "more positive" message basically telling Americans we can do whatever we want. And then after 9/11 - Bush told us all we should go shopping and consume ever more.And now with corporations calling the shots in Washington - long-term sustainability of the planet takes a back seat to short-term profits. If we don't change our ways soon - and embrace clean, alternative energy and educate women around the plant - then we all could be headed for a rough century.-Thom(Is there any chance we will learn in time? Tell us here.) -
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