Author: tracyliu1987108

RMB has been rising again   [Copy link] 中文

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Post time 2012-10-27 14:14:41 |Display all floors
For China there is more than one dimension. Its RMB must serve its own interest but at the same time take other currencies interest into account to a certain extent. China must remember that it is not an island and an island will have limited live span in this internationalised world. Thus it is unwise to act selfishly without considering the impact on others.

Interest rate has to shoulder two to three burdens - the more important one, domestic investors - the majority of whom have limited access to the vast investment opportunities that the rich has. So the interest rates must preserve the savings of the majority which is the primary social obligation. A country cannot have its people without savings as that is very susceptible to social discontent. Thus savings is a means to encourage people to live normally and productively. If the theory that rewards is tied to performance than savings is the motivation to perform. It is a question of coming out with a formula that the common people can conceive. Next is the business fraternity. Interest rate can't go up too high but neither can it be artificially lowered as it would hurt more people than it helps. Businesses have to be efficient and not rely on macro-economic assistance to compete. The interest rate is only one component to the cost of production - the more critical factor is wastage - time, consumables and manpower. By not lowering the interest too much, the weight of the currency is stronger. Thus businesses will be forced to sharpen their efficiency and effectiveness to stay competitive. In the long run this gives genuine real strength to the businesses. When these businesses can survive domestically they will grow to compete internationally and at that level they can average out their financial cost with forex. The third factor is to do with investments. The ease of lending is not a good business because if a debtor cannot pay, that can become an irrecoverable debt. When this happens a currency can collapse (assuming that debt is huge) . On the opposite, outbound investments, it is favourable as this works the money to generate better returns. China should divest some of its loans to US and convert them into viable foreign tangible investments. and continue to promote Asian trade in RMB and this can be cautiously expanded to Europe and Africa.

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Post time 2012-10-27 15:23:42 |Display all floors
I have mixed feelings on this matter being both an importer to China and an exporter from China, however at the moment my savings are going into RMB. The future is in the Chinese market place.

I remember the days of 15 RMB to 1 £GBP, now it is only around 10, o happy days!

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Post time 2012-10-27 17:25:23 |Display all floors
Truth_update Post time: 2012-10-27 05:42
I assume you are referring to the toiletpaper USA greenbacks that Bernake is churning out by the s ...

Language !
Your own mind is a sacred enclosure into which nothing harmful can enter except by your permission. Arnold Bennett

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Post time 2012-10-27 17:48:30 |Display all floors
Truth_update Post time: 2012-10-27 06:49

24th October 2012.

Internet users across the border are enthusiastically discussing plans to shop in Hong Kong as the yuan climbs to a 19-year high.

The exchange rate has risen in the past few days, passing HK$1.25 as the yuan appreciated against the weak US dollar, to which the Hong Kong dollar is pegged. Beijing devalued its currency in late 1993.

Mainlanders are expected to take advantage of the resulting "discounts" in Hong Kong.

On Sina Weibo, the most popular microblogging service on the mainland, users posted messages yesterday saying "Everything over 20 per cent off in Hong Kong" and "Brothers, let's go [shopping]".

Meanwhile, mainlanders already in the city were emboldened to spend more.

"I don't have time to come more often, but I will definitely spend more because things are even cheaper now," a 28-year-old visitor from Shanghai said.

She said she visited twice a year, spending more than HK$10,000 each time on fashion items and also household items like milk powder.

A shop in Causeway Bay said it had yet to see more mainland visitors. "There are as many of them as always," a Fortress salesman said.

In Sheung Shui, where parallel trading is a nuisance to residents, shops said they had raised prices because of higher rents, giving non-locals less incentive to buy goods in bulk to be resold across the border.

About 40 internet users and residents joined a protest initiated on Facebook outside the Sheung Shui MTR station.

Protesters said the government's intensified action against the practice had failed to deter parallel traders.

Some had ways to get round new size and weight restrictions on luggage imposed on the MTR, they said.

"They now pack the goods in small baggages or backpacks," Sheung Shui resident Tam Miu-ying, 59, said. "They make sure every carton they carry falls within the new size limits."

On evenings when there were no police around, about 200 traders flooded the station, as in the past, she said.

Fellow protester Dennis Wong said: "No matter how much work they do in Hong Kong to combat parallel trading, it won't be effective unless customs on both sides of the border work together."
Your own mind is a sacred enclosure into which nothing harmful can enter except by your permission. Arnold Bennett

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Post time 2012-10-28 07:10:36 |Display all floors
tracyliu1987108 Post time: 2012-10-26 16:06
Not they allowed it, america wants it to rise. America doesn't care what will happen to China econ ...

WELL SAID. Can't make a living now...

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Post time 2012-10-28 08:54:44 |Display all floors
That is not good for export .

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Post time 2012-10-28 18:05:43 |Display all floors
Truth_update Post time: 2012-10-27 06:49

mad guy

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