Early this month Martin Wolf had another of his very interesting articles, this time on China, which I think suggests some of the concerns we must have about the upcoming adjustment. Wolf argues that it may be useful to think about Japan as a model for understanding the adjustment process in China since the Japanese model …
Read More…Category: Trade war
The Japan debt disaster and China’s (non)rebalancing
In this issue of the newsletter I want to sketch out a scenario in which rather than analyze policy announcements or make predictions I try to lay out what are the various possible paths open to China. The scenario concerns trade. China’s current account surplus has declined sharply from its peak of roughly 10% of GDP …
Read More…Currency manipulation
On Friday the US Treasury released its presumably semi-annual (it was due last October) report to Congress on currency issues, and in it refrained from calling any of the countries under review “currency manipulators.” Today’s People’s Daily had this to say : Major trading partners of the United States, including China, did not manipulate their currencies …
Read More…QE2 and the Titanic
China reported an October trade surplus of $27 billion Wednesday. This is a very big number and not one likely to soothe anger directed at China. It will be very hard for China credibly to argue that it is trying to contribute to global growth while pulling in more and more foreign demand. Here is …
Read More…Will trade action bring back American jobs?
In the debate about global trade imbalances, we often hear it said that because Americans produce nothing that China exports to the US, any move to restrict Chinese imports to the US would have no employment effect on Americans. A forced contraction in Chinese exports would simply result in an equivalent increase in the exports …
Read More…Xin Fa’an: A modest proposal to resolve the coming trade war
Earlier this week I had a debate on TV with a local economist on the subject of trade relations. We had the same debate about six and twelve months ago and in each case while I argued that the trade problems were almost intractable and trade relations would inexorably deteriorate, he both times acknowledged that …
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