Comments on: China’s compensation for taking dollar risk …

By: scrap metal recycling

scrap metal recycling — Wed, 05 May 2010 04:51:59 +0000

Is it time to learn Chinese yet?

By: One Dumb Administration « Thought Shop

One Dumb Administration « Thought Shop — Sat, 06 Mar 2010 20:55:09 +0000

[...] Dumb Administration By Brian Hayes We’re paying far more interest to China than in [...]

By: Las agencias estudian rebajar la calidad de la deuda pública de EEUU « El Santo Grial está en Argentina!

Sun, 17 May 2009 17:55:58 +0000

[...] que tiene que pagar EEUU al régimen chino, sobre todo desde 2004, tal y como recoge el think tank Council on Foreign Relations. Y ello, pese a la caída de la rentabilidad ofrecida en la emisión de bonos del [...]

By: RebelEconomist

RebelEconomist — Tue, 12 May 2009 15:49:37 +0000

As usual Twofish, you are high on contrary opinions and low on evidence.

By: Twofish

Twofish — Tue, 12 May 2009 12:54:08 +0000

RebelEconomist: I would be interested to know of evidence that supports this statement. The issue is one that often arises.

It’s rather straightforward. Take a tuition bill or hospital bill, and then do some leg work to follow the money.

By: RebelEconomist

RebelEconomist — Tue, 12 May 2009 12:21:38 +0000

Interesting comment, Twofish:

“The basic problem isn’t expensive technology, it’s expensive people. If you look at the cost of medical care most of it goes to people.”

I would be interested to know of evidence that supports this statement. The issue is one that often arises.

By: Cedric Regula

Cedric Regula — Tue, 12 May 2009 02:32:09 +0000

Ya, raising bank reserves worked! And the global bust is now causing deflation.

I don’t have the official data series for the entire decade, I was just remembering a news report. It focused on the 2003 thru 2007 period where the PBoC was trying to fight inflation various ways and also limit over-investment in certain industries(aluminum was one they were worried about). The news report did say inflation hit 8% for some period of time.

So I guess that saying “most of the decade” is incorrect and it was probably only during the period that the trade surplus was rapidly going up.

But the main reason I remembered this is that raising bank reserves will be the only tool left that the Fed has if and when the US economy ever recovers.

By: DOR

DOR — Tue, 12 May 2009 01:53:07 +0000

Obvious error. China’s CPI (YoY) in January was +1.0%, Feb -1.6%, Mar -1.2%. That averages -0.6%, not +0.2%.

Apologies.

By: DOR

DOR — Tue, 12 May 2009 01:40:37 +0000

China’s urban consumer inflation was less than 1%, year-on-year, in the past six months and –0.6% in Q-1 2009. In the first six years of the decade (2001-06), inflation averaged 1.4%; in the following 8 quarters, it was 5.5%, but was just +0.2% in Q-1.

If that’s what is meant by “Thru most of the decade the PBoC has been fighting inflation,” then they are the absolute master of that particular game. Not only did each of their efforts fail (raising interest rates, issuing sterilization bonds, raising band reserves), but the outcome was complete success!

Or, alternatively, perhaps the PBoC really spent more than half of the decade fighting DEflation, and finally beat down that horror just in time for global external demand to tank. Seems like the more plausible explanation to me.

By: chaingangcharlie

chaingangcharlie — Mon, 11 May 2009 23:25:31 +0000

Cedric -

best laugh I had all day