Quite that contrary ... I'm quite certain they will, eventually. But, given that I see no evidence of it yet and, given their significant need to employ hordes of people as they become less agrarian, I have no reason to anticipate such a sea change. Hence my request for you to predict what century it will happen in.
A century implies you don't think it will happen. But the reason China have to unpeg has nothing to do with employing people. It is the adjustment process. Pegging makes the adjustment process impossible. It allows us to import while not exporting. As far as when China unpegg, i don't think it is too far off. In order for the citizens to consume, China can not keep increasing wages. That will just cause inflation. We are seeing that now. So the next logical step is to free up the currency. Unleash its purchasing power. Perhaps the next boom in China is a consumer led boom.
China is communist country that follows principles of planned economy according to underlying communist ideology. Money and currencies are just unnecessary evil of capitalism according to that ideology. Right now they just playing along and pretend because it is convenient for them. You cannot analyze China using western point of view.
Communists countries have turned capitalist (and vice versa). You suggest the situation is static but it's most definitely not.
China is still communist country as of today and Chairman Mao is pictured on their paper money managed by Central Committee of Communist Party. I do not think Chinese want to westernize like east Europeans who considered communism as foreign invasion. Again, do not analyze China using western economic concepts and wishful thinking.
In one sense, you're right. A bond holder who held from 1962 to 1982 got annihilated. The long term trend isn't much of a consolation when you're getting annihilated by inflation. It's a bit like saying that nuclear power is a great technology most of the time. But I still think you're wrong. Let's take the period you chose, the last fifty year. 2013 isn't over, so let's pick 1962-2012. Remember that this period includes US withdrawal from the gold standard and the most severe bout of inflation in US history. The geometric rate of inflation over those 50 years was . . . 3.7% . Ooooh, scary. OK, let's compare a bond investor and a gold investor over that same period. Gold: geometric return (from $35 to $1650): 7.95% US 10 year: 6.8% (see http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html ) So gold did beat a US bond holder over that period, but not by much. And the bond holder handily beat inflation. A combination of bonds and stocks would have crushed gold, but whatever. That's stacking the deck. Also remember that I don't think you could really buy gold at $35 in 1962. I could be wrong about that.
You're correct. I was thinking of silver which was pegged @ $1.29. You could bring silver cetificates and get an ounce for $1.29.