tag:blogger.com,1999:blog-2277215496195926573.post4655441295897464181..comments2024-01-01T07:41:51.347-08:00Comments on RALPHONOMICS: Exporting to Mars and Jupiter.Ralph Musgravehttp://www.blogger.com/profile/09443857766263185665noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-2277215496195926573.post-79601369004489397342015-08-12T04:24:02.639-07:002015-08-12T04:24:02.639-07:00I certainly agree on your conclusion!
Let us thin...I certainly agree on your conclusion!<br /><br />Let us think of this Chinese action in terms of QE. <br /><br />Every not-China currency has been given a dose of QE. They can trade their currency for ADDITIONAL yuan and thus buy more Chinese products (than they could before the yuan devaluation). This will boost the Chinese exports and enable the Chinese workers to work harder (and additional hours) because they now have more markets.<br /><br />On the other hand, the Chinese retired people will have less opportunity to buy not-Chinese products because they will cost more (due to the yuan devaluation). This will cause the not-China world to work less. <br /><br />Stated another way, if the Chinese work harder for less foreign currency, then they should gain market share. The remaining not-China world will work less, having lost market share.<br /><br />We might even consider this action to be deflationary for the not-China world.<br /><br />Thus goes devaluation in terms of QE.Roger Sparkshttps://www.blogger.com/profile/01734503500078064208noreply@blogger.com