The Illusion of Chinese Weakness

[LeveragedBuyout]

If u think China economy == Japan economy, China political and diplomatic == Japan's ... u know nothing about East-Asia. Compared with Japan, China RMB exchange rate still controlled in Chinese hands not in American, this is the radically difference. Japan gave it up, export prise increase and killed their rising export trades, just guess who request that ? ( I said the Japanese has enough reasons to hate U.S twice. But for China we thanks American ) And the White House accused of BeiJing government manipulating RMB exchange rate, did China care them ?!

China's leadership has actually cared a lot about US complaints about the RMB. That's why the RMB was de-pegged from the dollar and allowed to appreciate starting in 2005. All of the Chinese users seem to think that Japan blindly signed the Plaza Accord in a vacuum. No one asks why they signed, you just assume that the US ordered it, and Japan meekly followed. No, please think about incentives.

 

[TaiShang]

Maybe US requests and China's own goals have matched to some degree.

Whatever appreciation there has been, it has been internally decided. A sovereign country does not change its monetary policies for the sake of others' concerns.

China has been allowing the RMB to appreciate only incrementally in order not to hurt the economy which still relies to some extent on exports.

However, China's Central Bank also seems to maintain that controlled appreciation is required in order to encourage economic growth, internationalize the Yuan and ensure economic stability.

 

[cnleio]

China's leadership has actually cared a lot about US complaints about the RMB. That's why the RMB was de-pegged from the dollar and allowed to appreciate starting in 2005. All of the Chinese users seem to think that Japan blindly signed the Plaza Accord in a vacuum. No one asks why they signed, you just assume that the US ordered it, and Japan meekly followed. No, please think about incentives.

In 1989.9, 1 U.S dollar = 250 Yen
In 1990.1, 1 U.S dollar = 200 Yen
Now 2014.9, 1 U.S dollar = 104.892 Yen

2005, 1 U.S dolloar = 8.27 RMB
Now 2014.9, 1 U.S dollar = 6.1464 RMB

What u think Japanese got by signed this Plaza Accord , they ever had the ability to buy entire U.S ?

 

[BoQ77]

In 1989.9, 1 U.S dollar = 250 Yen
In 1990.1, 1 U.S dollar = 200 Yen
Now 2014.9, 1 U.S dollar = 104.892 Yen

2005, 1 U.S dolloar = 8.27 RMB
Now 2014.9, 1 U.S dollar = 6.1464 RMB

What u think Japanese got by signed this Plaza Accord , they ever had the ability to buy entire U.S ?

you figures show nothing cnleio, if you want to show us SOMETHING.

 

[cnleio]

you figures show nothing cnleio, if you want to show us SOMETHING.

I showed the truth how Japan export trades get hurts by increasing their Yen exchange rate, and how U.S complaint China RMB exchange rate still high, but Hu retired and Xi up RMB exchange rate will return 7.0.

 

[BoQ77]

I showed the truth how Japan export trades get hurts by increasing their Yen exchange rate, and how U.S complaint China RMB exchange rate still high, but Hu retired and Xi up RMB exchange rate will return 7.0.

What US complainted is "China keep controlling the exchange rate not let it fluctuate as market trend"

 

[cnleio]

What US complainted is "China keep controlling the exchange rate not let it fluctuate as market trend"

LOL ... China is not as same as Japan, that's why White House complaint China. We won't sign the Plaza Accord and RMB exchange rate only contnrolled by Chinese.

 

[BoQ77]

LOL ... China is not as same as Japan, that's why White House complaint China. We won't sign the Plaza Accord and RMB exchange rate only contnrolled by Chinese.

that's why I said your figure show nothing, because the policies to exchange rate are different.

China decided starting from the Asian crisis in 1998-1999 to keep its currency fixed versus the value of the US dollar. It did so until July 2005. It then switched to a managed float of USD/CNY, where the value of the renminbi gradually increased versus the US dollar (thus, USD/CNY gradually declined). In the course of three years, the renminbi strengthened by as much as 21% versus the US dollar. A change in China’s exchange rate policy came about in August 2008, as China’s export sector came under enormous pressure after the US subprime crisis eventually led to a wide decline in world trade. To protect Chinese exporters from further competitive pressures, China again decided to ‘re-peg’ its currency vis-à-vis the US dollar. Only in June 2010, the PBoC announced that the exchange rate would be made more flexible again, after which USD/CNY gradually appreciated at a 5% annual pace.

History of band widening:


Mar 2014 +/- 2%
April 2012 +/- 1%
May 2007 +/- 0.5%
Jul 2005 (unpegged) +/- 0.3

From March 2014 onwards, daily fluctuations in USD/CNY are a maximum of 2,0%.

 

[Chinese-Dragon]

Sir,

China is an extremely inferior military power when it come to facing the united states---. Neither it has the aircraft, nor the submarines, surface ships etct etc to stand up to the united states.

Well---here is a comparison----a million dollar missile dropped on a 10 dollar hut is in Afghanistan will do a 10 dollar damage----but that same missile dropped on a 10 million dollar factory or similar installation will have a multiplier effect far acceding the cost of the missile.

The only thing china can do is to take on india--and that is all.

All these little games that china is playing---the u s will get them when they want to---just like the Americas got the japaese in the 80's and the 90's----. The Japanese came a swinging in the 80's and buying everything in America---there was a fear created that the japanese will own everything---well the good old American white boys gave them all the rope to hang themselves----the Japanese bought the casinos in vegas and the white boys tore them up---the Japanese left the united states with their tails between their legs and their economy in the japan in shambles---and still have not recovered after 20 years---nobody talks of Japanese owning the u s----.

None can compete with the DEVIOUS planning of the white boys---be it Chinese---japanese---Indians or otherwise---when the americans get you---there will be no place to hide---. Boy do they give you enough rope to hang yourself or what.

If your "white boys" are so clever, then I guess you don't have anything to worry about?

Just leave China in peace, we are trying to develop our economy.

Whatever else you want to do is your own concern.

 

[Owl of Abott]

the military strength doesn,t matter.during the korean war the chinese army defeated americans and they only used small arms like riffles and mortars while americans had the most advanced weaponry of that time.

 

[Developereo]

None can compete with the DEVIOUS planning of the white boys---be it Chinese---japanese---Indians or otherwise---when the americans get you---there will be no place to hide---. Boy do they give you enough rope to hang yourself or what.

I agree with you.

As much as I admire China, it has a long, long way to go.

Money by itself mean jack sh!t. Japan has a 6 trillion dollar economy but it is mostly irrelevant on the global stage.

The ONLY thing that matters is military (technological) power and cultural power.

In both these spheres, the US dominates the globe by a mile and a half. No other country -- not Russia, not China, not Japan or Germany, France or UK -- can come even remotely close to challenging American global dominance in technology and culture.

That is unlikely to change through the middle of this century.

 

[$@rJen]

Why do Chinese should help American to remove Assad from power?? maybe keeping or removing him is not in the interests of Chinese but helping US to remove Assad is going give more power and influence for the Americans...Why would China do that when she's competing with US???? How hard its for the Author to find that out.??

 

[LeveragedBuyout]

In 1989.9, 1 U.S dollar = 250 Yen
In 1990.1, 1 U.S dollar = 200 Yen
Now 2014.9, 1 U.S dollar = 104.892 Yen

2005, 1 U.S dolloar = 8.27 RMB
Now 2014.9, 1 U.S dollar = 6.1464 RMB

What u think Japanese got by signed this Plaza Accord , they ever had the ability to buy entire U.S ?

I will answer your question with a question: why did China allow the RMB to float, when everything seemed to be working so well for it under the dollar peg?

The answer to my question is the same as the answer to your question about the Plaza Accord.

If your "white boys" are so clever, then I guess you don't have anything to worry about?

Just leave China in peace, we are trying to develop our economy.

Whatever else you want to do is your own concern.

One only needs to look at Europe to see how this racial theory fails.

 

[TaiShang]

I will answer your question with a question: why did China allow the RMB to float, when everything seemed to be working so well for it under the dollar peg?
The answer to my question is the same as the answer to your question about the Plaza Accord.

The difference is that the Plaza Accord was imposed upon Japan and carried out at a faster momentum.

China does indeed carry out monetary policy, but just as it sees fit. If some of these policies also suits US requests, that's nice. But we let's not create an image of obedience out a pure coincidence.

China always demanded non-intervention during the second invasion of Iraq. The US, under Obama, finally came close to that line of thinking. Was that because China had been saying so for a decade? No, it was just because your national security calculations have changed under a different administration.

China's new administration will certainly have its own interpretation of China's fiscal/monetary/economic policy.

Monetary sovereignty is as important as territorial sovereignty. Just as China does not dictate the Federal Reserve, the US gov't cannot dictate China on what to do with its own currency.

Evidence, unlike US demands, (and unlike Japan's historical experience) China's appreciation of the Yuan is rather incremental. This is in fact why respected member cnleio has shared the historical figures above.

 

[Genesis]

Sir,

China is an extremely inferior military power when it come to facing the united states---. Neither it has the aircraft, nor the submarines, surface ships etct etc to stand up to the united states.

Well---here is a comparison----a million dollar missile dropped on a 10 dollar hut is in Afghanistan will do a 10 dollar damage----but that same missile dropped on a 10 million dollar factory or similar installation will have a multiplier effect far acceding the cost of the missile.

The only thing china can do is to take on india--and that is all.

All these little games that china is playing---the u s will get them when they want to---just like the Americas got the japaese in the 80's and the 90's----. The Japanese came a swinging in the 80's and buying everything in America---there was a fear created that the japanese will own everything---well the good old American white boys gave them all the rope to hang themselves----the Japanese bought the casinos in vegas and the white boys tore them up---the Japanese left the united states with their tails between their legs and their economy in the japan in shambles---and still have not recovered after 20 years---nobody talks of Japanese owning the u s----.

None can compete with the DEVIOUS planning of the white boys---be it Chinese---japanese---Indians or otherwise---when the americans get you---there will be no place to hide---. Boy do they give you enough rope to hang yourself or what.

you forgot to add, a 10 million dollar missile on a Afgan hut result in some IEDs, same missile on Chinese factory result in nuclear apocalypse.

But yes we can't take on the US right now.


But the fundamental difference between us and Japan is we are not Japan, Japan faces an uphill battle regardless due to its size, but when Japan was our size in terms of Per Capita, it wasn't much, but today we are already the second biggest economy.

We don't own as much in the US as some might think, most of the money is still invested in China. You know, the market that houses some 1.4 billion people.

Look at the world's top sites, without expanding to the international stage, a lot of out sites are already in the top 20-30.