Author: jimmy67

Are Asian central banks using RMB as reserves now? [Copy link] 中文

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Post time 2007-1-16 14:19:30 |Display all floors
Originally posted by jimmy67 at 2007-1-16 10:24
In this  thread which I launched, I copied a comment from somebody else who wrote to a story about China's RMB on CD online.    I don't believe that U.S. is running red at all.  It is economically  ...


RMB is not traded in the open market!!!

if one does not want to depend on USA,

one must MAKE Products at CHEAPER COST

& get monies from patents, royalties,licensing, directors fees & stock options,etc.......!!!

That's how Westerners MAKES Money by SUCKING from you at Exotic prices!!!
What's on your mind now........ooooooooooooooo la la....Kind Regards

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Post time 2007-1-16 16:04:34 |Display all floors
Q&A: Author Will Hutton on China's Future

By James Pethokoukis

Posted 1/5/07

U.S. News recently exchanged E-mails with Will Hutton about his new book, The Writing on the Wall: Why We Must Embrace China as a Partner or Face It as an Enemy.

What would be the impact on China domestically if the yuan appreciated 40 percent, as some U.S politicians would like to see happen?

The more than 50 percent rise in the yen in the late 1980s was the single most important cause of Japan's near-15 years of economic stagnation that followed; if the yuan went up by 40 percent suddenly against the dollar, it would have a similarly devastating impact on China. It would bite in two huge ways.

Firstly, it would cause peasant incomes to fall sharply because China's internal food prices would fall by up to 40 percent as food imports became cheaper with the appreciation of the yuan; 780 million Chinese still live on the land. And it would stop the 25 percent growth of China's 1 trillion dollars of exports in their tracks–the most important source of economic growth and employment in China's coastal cities.

It is already hard enough to find work for more than 10 million migrants who leave the land each year; with a yuan appreciation of that magnitude the numbers would swell into a flood of migrants just as the opportunities for their employment in the eastern coastal cities dramatically worsened. Open and disguised unemployment in China is estimated to exceed 170 million. Unrest is growing even under current conditions. Such a rapid appreciation of the yuan over a short period could be a tipping point for a wave of unrest, which could threaten the regime's stability. The party leadership sees the demand for fast yuan appreciation as an act of economic warfare. In these terms, you can see why.

What would be the international economic impact if growth in China were to stagnate?

China's growth, because the country has been so open to imports, has been the single most important stimulus to the Asian and, thus, world economy over the past five years. China's stagnation would trigger a global slowdown, maybe even recession. On the plus side, oil and commodity prices would fall.

On the negative side, there would be all the ills of a slowdown, but on top there would be major financial implications. The World Bank estimates that if China's growth rate fell by just 2 percent, up to 60 percent of China's bank loans would become nonperforming–so threatening both China's and, via Hong Kong, Asia's financial system. The flow of saving to finance the U.S.'s deficit would dry up, probably forcing U.S. interest rates up–so worsening the economic slowdown.

What's the greatest threat to continued fast growth in China, and what are the probabilities of its occurrence?

There are four great economic threats. I've discussed the revaluation of the yuan. Next there is the threat of protection against Chinese exports. Then there is the threat of a sharp rise in inflation, forcing an increase in interest rates and credit controls. Or there is the risk of a credit crunch forced by the banking system being overwhelmed by nonperforming loans. The fifth threat is political–the turmoil that would follow a fight for political power. I think there is more than a 50 percent chance of protection against Chinese exports, a 30 percent chance of a sudden sharp revaluation of the yuan, and a 20 percent chance of dangerous inflation and of a credit crunch. The risk of political instability is low, but it exists.

  1. http://www.usnews.com/usnews/biztech/articles/070105/5china.htm?s_cid=rss:site1
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Post time 2007-1-16 16:42:31 |Display all floors

myths

Originally posted by caringhk at 2007-1-16 14:19


RMB is not traded in the open market!!!

if one does not want to depend on USA,

one must MAKE Products at CHEAPER COST

& get monies from patents, royalties,licensing, direc ...



China already makes products at cheaper cost.  Being the low cost provider can only get you so far.  It is an easy thing to duplicate.  

Patents can be copied, liscensing can be forged.  As we have seen in China, these things only carry you as far as the government supports them.  

What the US does that is successful and has created their middle class is to be the high quality leader in services and products.  They have more INTANGIBLE elements in their economy that are more difficult to copy or replicate.  One example would be Coca-Cola.  Although hardly an American company anymore, its a symbol, as is McDonalds.  China needs to eventually develop these brands and products that are known all over.  People buy a Lexus (admittedly Japanese) for the quality, they pay more for it because its high class.  That is the niche that America and Japan have picked up so well.  Providing things that cannot or will not be dominated by knock-offs and a flood of low cost providers.  

Back to the RMB, it will continue to change and I believe will eventually dominate the world markets along with the dollar.  While it will never develop the long history of stability, it may eventually be seen as a better choice as the dollar continues to be devalued worldwide.  As companies hedge their risk by buying RMB instead of the $ to protect against depreciation, the proliferation will grow.  Its a LONG way from that though.  People are too wary about the stability of the Chinese gov and where its all heading in the near future. Cant wait to find out!

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Post time 2007-1-16 16:47:55 |Display all floors
Originally posted by barnaclebill at 2007-1-16 16:42



China already makes products at cheaper cost.  Being the low cost provider can only get you so far.  It is an easy thing to duplicate.  

Patents can be copied, liscensing can be forged.  A ...



actually cocacola lost to cooling chinese tea drinks

& mc'd to xiao-long pao!!!!

China needs to improve the packaging & more importantlt the MARKETING tech!!!

u know kfc had to ta-pao in Hong Kong as the Hongkies chickens there are TASTIER!!!
What's on your mind now........ooooooooooooooo la la....Kind Regards

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Post time 2007-1-16 21:09:23 |Display all floors

Absolute Rubbish!

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Post time 2007-1-17 05:58:33 |Display all floors

yes, somewhat I agree

-- " Back to the RMB, it will continue to change and I believe will eventually dominate the world markets along with the dollar.  It may eventually be seen as a better choice by people as the dollar continues to be devalued worldwide. " --

And, it is estimated RMB will appreciate by a further 4-6% in the whole of 2007 against the greenback.  As to those who are jittery about China's economic stability, time and again, I would rather reassure them that China's gdp will sail,  quite smoothly as in the previous several years by 9-11% or even more, in the coming years.  because the economy is marvellously taken care of by a group of experienced hands.

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Post time 2007-1-17 09:18:14 |Display all floors
Yes, but I think that the rest of the world won't change to renminbi until the government stops regulating it as they do not want a massive fall in renminbi facilited by the govt.
"When I am White, I win because I'm White.  When I'm Black, I win because I am Bogoljubow."

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