May 3, 2012
The U.S. House of Representatives decided just to introduce a tax on goods
The U.S. House of Representatives decided just to introduce a tax on goods when they are due to the devaluation of another country particularly cheap. It is an affront to China that its currency against the dollar has especially favorable. The European Union - China's largest export market - increased pressure on the People's Republic. And IMF Managing Director Dominique Strauss-Kahn warned: "Obviously, the idea spreads, currency as a political weapon."
China is the world in the pillory: The country of manipulating the yuan exchange rate in order to fuel their own exports, the reproach of America. The accusation is not without a certain irony. For if an economic power in the foreign exchange market, "war", then leads the United States. Increasingly desperate attempts by the government of President Barack Obama to boost the economy.
Fed Chairman Ben Bernanke helps: The U.S. central bank plans to further liberalize its highly expansionary monetary policy. So the Fed wants to stabilize the shaky U.S. economy. A weak currency and low interest rates should help exporters and ease the burden of public debt. Thereby aggravating the tense situation in America in the foreign exchange market. Investors wonder what the point of this policy, which was right in the crisis. But now it hurts the dollar.
Cheap red herring
And what does America? It does not return his own business, it railed against China. Not a day goes by that does not shoot an influential economist poison arrows towards Beijing, a lobbyist for U.S. companies complaining about unfair competition or a government representative of the Chinese Premier Wen Jiabao calls to revalue the yuan strong. Specifically, the fear is fueled from a grueling race to devalue.
The headlines remind us of the hot spring, when the euro had fallen into the fire of criticism and threatened to break apart. At that time agreed to speculators in London and New York: Now we get ready Europe. The attack is unsuccessful, because the EU and IMF tied a last minute rescue package. The signal was clear: we will not let the Euro-zone fail, because there are no winners.
The € opponents have understood the common currency gains in value since then. In Greece, Ireland and Spain, governments have struggled through in spite of public opposition to austerity budgets and reforms. The EU finance ministers agreed to even out that Brussels monitored in future national budgets to prevent a Greek-style routine.
Because the euro area economy returns to strength, is already thinking about the withdrawal from multi-billion dollar economic stimulus programs. And ECB chief Jean-Claude Trichet would reduce only too happy to cash flow, has been fighting with the central bank's financial crisis. That would certainly make the euro against the dollar even more.
China should remain stubbornly
Oddly enough, Europe can not appreciate this hard-won successes. Instead, they drilled into his own wounds, can be intimidated by the evil word currency war and still does in the chorus of those calling for a higher yuan exchange rate. This Europe has no need for that. Especially for the German economy, the rising euro exchange rate is still far from being a threat
Who buys German goods abroad, has determined for reasons other than affordability. And for the upturn, the growth of the global economy weighs heavy. Especially in times of crisis, China has done much to revive the global economy. Wen Jiabao is doing so well to raising the price of the yuan in small steps. A radical improvement would be not only for China but also for the rest of the world is a disaster.
America must stop looking to blame for its own economic misery for others, whether in Europe or China. The problems of the U.S. economy are not in the exchange rate of dollar, euro and yuan, but in a misguided monetary and fiscal policy and a serious lack of investment in the home.
The Fed, which has done many things right in the crisis undermines now fearful of its monetary policy with confidence into the country. The government has made in the just completed fiscal year $ 1.65 trillion national debt. The national debt is just over 94 percent of economic output, but there is no mention of saving.
Worse still: From 2006 to 2009, the investments in the U.S. have dropped by one third in the euro zone, however they put to around eight percent. The result: the capital stock of the United States crumbles. The economy has spent only ten percent of their capital in production in Germany is 20 percent. There, German companies presented her capital goods that are in demand all over the world, exchange rate or not. America should take this as an example, instead of lashing out against German export success and China's exchange rates.
by erectusplus at 3:50 AM |
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