Seems that this is getting a bit more contentious.
Myron Brilliant, senior vice-president for international affairs, who has previously helped to protect Beijing from hawkish trade policies, told the Financial Times: “I don’t think the Chinese government can count on the American business community to be able to push back and block action [on Capitol Hill].” --FT
And in the other corner:
China's commerce minister warned the United States on Sunday that if it launches a "trade war" against China by levying punitive tariffs on Chinese imports, the United States will suffer the most. --WaPo
PRC has a helluvalotta US dollars in its piggybank which it has to spend somewhere. OTOH, somebody's gotta buy US Treasuries or ObamaGummint goes "poof!!"
HT: CalcRisk
We have the upperhand. No question about it. Allowing the Yuan to appreciate against the dollar would substantially hit Chinese exports while boosting U.S. exports and providing a much needed stimulus to American producers. The Chinese asset portfolio would take a minor hit as they unloaded treasuries which would be mostly gobbled up domestically and abroad (mostly by Japan I would assume).
ReplyDeleteChina has been exporting capital AND unemployment for years. It's time they stop doing both for the good of everyone.