China is a currency manipulator ?

Discussion in 'Forex' started by Gcapman, Mar 16, 2010.

  1. Gcapman


  2. I think all 'export' oriented economies manipulate their currency.
  3. Here's the thing...

    It's not that China is a "currency manipulator." If that's the brush we're going to use, we're going to start painting way outside the intended lines.


    Well, to start, the United States is a currency manipulator.



    You may or may not know it, but the United States prints "money" that has no relation to any underlying value other than...what the United States wants (or hopes) it to be. More dollars, less dollars. Higher rates, lower rates. Strong dollar, weak dollar.

    China's "issue", in this case, is that much of the international community disagrees with their policy of pegging their currency to the dollar. They argue that China's currency is in the position to stand on its own and float against other major currencies. In other words, the international community would prefer that a major economy such as China let the market decide the value of their currency...much as every other developed economy does.

    In the eyes of many, China's decision to peg its currency is no more strange than the United States' decision to print a nearly limitless number of dollars. However, the saving feature of the U.S. policy is that it leaves to the international community the ultimate power - however fleeting or vague it might be - the responsibility of determining the correct "value" of those dollars.
  4. Ben bernanke is king currency manipulator no.1