Win a copy of TensorFlow 2.0 in Action this week in the Artificial Intelligence and Machine Learning forum!
  • Post Reply Bookmark Topic Watch Topic
  • New Topic
programming forums Java Mobile Certification Databases Caching Books Engineering Micro Controllers OS Languages Paradigms IDEs Build Tools Frameworks Application Servers Open Source This Site Careers Other all forums
this forum made possible by our volunteer staff, including ...
Marshals:
  • Campbell Ritchie
  • Liutauras Vilda
  • Paul Clapham
  • Bear Bibeault
  • Jeanne Boyarsky
Sheriffs:
  • Ron McLeod
  • Tim Cooke
  • Devaka Cooray
Saloon Keepers:
  • Tim Moores
  • Tim Holloway
  • Jj Roberts
  • Stephan van Hulst
  • Carey Brown
Bartenders:
  • salvin francis
  • Scott Selikoff
  • fred rosenberger

Yuan becoming a top business Issue in U.S. - 16 Congressmen write letter to Bush

 
Ranch Hand
Posts: 36
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
http://www.nytimes.com/2003/08/26/business/worldbusiness/26CHIN.html?pagewanted=1&ei=5040&en=d1b518f3467c2b1b&ex=1062561600&partner=MOREOVER
Currency of China Is Emerging as Tough Business Issue in U.S.

WASHINGTON, Aug. 25 — With unemployment high and American manufacturers reeling from three years of misery, politicians and businesspeople around the country have found a villain to blame for these troubles: China, or more specifically its currency.
In South Carolina, the Republican governor, Mark Sanford, cites the currency, the yuan, as posing a major threat to his state's struggling textile industry by making Chinese exports unreasonably cheap.
In Erie, Pa., executives and workers at scores of industrial companies are planning a loud protest on Labor Day over "unfair competition" — and one of the biggest targets will be the seemingly obscure matter of the yuan.
And in Washington, the Bush administration is gearing up to put direct political pressure on China next week when Treasury Secretary John W. Snow makes a highly publicized trip through Asia. The subject was near the top of the agenda when President Bush met with his economic team two weeks ago in Crawford, Tex.
The issue is the value of the yuan, which the Beijing government pegs to the dollar rather than allowing it to float in world currency markets. Critics say that keeps the yuan undervalued by as much as 40 percent, enabling Chinese manufacturers to flood the United States with products at prices that homegrown companies cannot match.
Though Chinese exports have been growing at the expense of American manufacturing jobs for years, the volume of the complaints has risen with the unemployment rate — and with the approach of national elections next year. And no matter what it does, the White House is on treacherous ground.
If the administration does not push China hard enough, it risks losing crucial support in important electoral districts. But if it pushes too hard, it could alienate China at a time when the United States needs Beijing's help in containing North Korea.
Then there is the risk of alienating American consumers, who benefit from inexpensive Chinese goods. "This is probably the hottest single trade issue," said Representative Phil English, Republican of Pennsylvania and head of the Congressional steel caucus. "I believe the administration would be making a big mistake if it ceded the high ground on this issue to some of Mr. Bush's competitors."
In a blunt letter to President Bush last month, 16 Republican and Democratic senators and representatives complained that China was undercutting American factories by intentionally keeping its currency undervalued.
The lawmakers, from Democrats like Senator Charles E. Schumer of New York to Republicans like Mr. English and Senator Elizabeth Dole of North Carolina, demanded that Mr. Bush press China to adopt a free-floating currency and to let the yuan rise in value.
"The fragile coalition for free trade is weakening because of the huge loss of manufacturing jobs in most parts of the country," Senator Schumer said. "Correcting the exchange rate with China is the perfect way to stem some loss of jobs without violating international trade rules."
Senator Joseph I. Lieberman, Democrat of Connecticut, signed the letter and has made the issue part of his presidential campaign platform.
(excerpted)

Encouraging to hear that this issue has national attention now..
 
Ranch Hand
Posts: 325
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
What about huge job loss in the IT sector? Are politicians able to find a villain to blame? Is it also because Chinese Yuan pegs to the Dollar? I personally do not think so. By the way, have you seen this article "Bush to Offshore Congress" at http://www.fallcreek.com/jay/bushlaysoffcongress.html
[ August 26, 2003: Message edited by: Natalie Kopple ]
 
Greenhorn
Posts: 1
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Those politicians are stupid. The possible loss of jobs from China because of the rise of the Chinese Yuan will not increase the overall employment in the US. The only result is: US comsumers pay more. The reason is simple: the Chinese economy compensates well with US economy in the big picture. Low tech vs. high tech. The low tech jobs lost in China (if possible) only move to other third world countries. It WILL not come back here. The US compusmers end up paying more. Politician shall look at how to keep the high paying jobs in US
 
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Here is some additional analysis from some experts.
--Mark
 
Nathan Thurm
Ranch Hand
Posts: 36
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Having read the sounddollar article as well as the most recent BusinessWeek, I’ve rethought my views somewhat on this. I think that it is a very good thing that the sixteen congressmen have the Bush administration's attention with this important issue. However, it seems that revaluing the yuan right now is probably not the right thing to do and asking a bit much, in my opinion:
1.Because the risk is pretty high that a Japanese type crash could occur, similar to when they revalued their yen due to:
a.China’s financial markets not being ready for this readjustment
b.Good chance that this could bring China's economy to a halt at this
point in time and of course this would not be desired
c.One revaluation might prompt anticipation of further readjustments, difficult to break from this mentality as Japan experienced

2.Less radical solution, for now, to reduce disparity between Chinese costs and US costs may be to, through negotiation,:
a.Get China to agree to lessen governmental subsidies of it’s companies which are affecting free trade
b.Lower Chinese tariffs
c.Reduce government intervention that requires high-tech companies wishing to do business in China to move R &D to China also
d.Any other governmental interventions that are affecting free trade would be good candidates to consider
3.Finally, an aside here from what I’ve heard from Chinese friends, pegging the Yuan to the dollar at an 8.28 to 1 rate isn’t arbitrary. In fact there’s meaning to it, in Chinese 8.28 is ‘ba – er – ba, which means ‘prosperous and more prosperous’. There is some superstition here that would be difficult to to convince the Chinese to break from. Especially, if say, the US trade representative tried to get China to cut this rate in half, 4.14 or ‘si yi si’ means ‘die and die one more time’, not likely the Chinese will go for this. I thought this was interesting and it was one factor in my change in views. Now if there were a number with positive significance between these two...
[ August 27, 2003: Message edited by: Nathan Thurm ]
[ August 27, 2003: Message edited by: Nathan Thurm ]
 
Greenhorn
Posts: 19
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator

Now if there were a number with positive significance between these two...


A good example is 1 us$ = 6.66 chinese yuan.
"6.66" in chinese means that everything goes well, forever.
 
Mark Herschberg
Author
Posts: 6049
2
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Interesting. I can very much see Chinese ministers choosing a number like that for just that reason. It makes a lot of sense culturally. It's extrondinarily foolish financially. Someone is going to make a lot of money.
--Mark
 
Ranch Hand
Posts: 34
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
In Chinese, 8.88 is definitely a better number than 8.28 . Numbers like 8.98, 9.98, and 9.99 etc are good ones too
[ August 27, 2003: Message edited by: J. Yan ]
 
Saloon Keeper
Posts: 22678
153
Android Eclipse IDE Tomcat Server Redhat Java Linux
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
Off the top of my head, it seems like pegging the yuan to the dollar would be more to the benefit of the US and other dollar-relative countries than to China. The Chinese would either make more or less relative to their own economy or have to adjust their product prices to keep from being dragged along in the dollar's wake.
Most countries that peg to the dollar do so because they want to avoid the volatility their economy would see if it matched their political troubles. China doesn't fit that picture. The main thing it gets them is consistently everyday lower prices at Wal-Mart.
 
Greenhorn
Posts: 11
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator
2003 Average Rates of 1 Dollar:
January 8.27746 CNY (21 days average)
February 8.27799 CNY (19 days average)
March 8.3249 CNY (21 days average)
April 8.27715 CNY (22 days average)
May 8.27692 CNY (21 days average)
June 8.2771 CNY (21 days average)
July 8.27729 CNY (22 days average)
August 8.27439 CNY (19 days average)
So you can see: it is not always 8.28. About how these numbers were decided? I do not know before doing some research.
 
Nathan Thurm
Ranch Hand
Posts: 36
  • Mark post as helpful
  • send pies
  • Quote
  • Report post to moderator


2003 Average Rates of 1 Dollar:
January 8.27746 CNY (21 days average)
February 8.27799 CNY (19 days average)
March 8.3249 CNY (21 days average)
April 8.27715 CNY (22 days average)
May 8.27692 CNY (21 days average)
June 8.2771 CNY (21 days average)
July 8.27729 CNY (22 days average)
August 8.27439 CNY (19 days average)
So you can see: it is not always 8.28. About how these numbers were decided? I do not know before doing some research.


To my understanding, China manipulates their currency exchange rate by continually buying our debt which makes the demand for our dollar higher and keeps the exchange rate between the yuan and dollar around 8.28. I'm guessing China does this in reaction to currency rate fluctations which is why the average rates aren't exactly 8.28.
 
I don't get it. A whale wearing overalls? How does that even work? It's like a tiny ad wearing overalls.
the value of filler advertising in 2020
https://coderanch.com/t/730886/filler-advertising
reply
    Bookmark Topic Watch Topic
  • New Topic