China bows to pressure, cuts yuan's ties to dollar China bows to pressure, cuts yuan's ties to dollar
Friday, July 22, 2005
By Jim McKay, Pittsburgh Post-Gazette
China yesterday announced it will no longer peg its currency to the U.S. dollar, a long-awaited change sought by the Bush administration, the nation's manufacturers and much of the industrialized world.
The motivation for the Bush Administration to force the cut gives the Bush Administration and others in DC more power and extra leverage to mess with, jack around about, manipulate, de-value, inflate, twist, and generally screw up the relationship of our currency situations.
These governmental, power-hungry, agenda driven, short-sighted political hacks can soil and broker relationships now.
In the past, as the dollar went, as did the currency of China. American's couldn't zig without a matching move from the Beijing money markets too.
I like it when forces of nature and the force of the marketplace are stable, untouchable, and established. As the world gets to understand and respect the greater forces at work in our global landscape -- forces that can't be put currency into a toilet or elevated -- by wire-pullers -- then we allow ourselves and others to stand or slump on our own merits.
If you need to prop up some favorite friends (donors, lobby-interests) then you need to have a bigger tool-box to play games with economic interests. That's bad for the little guys, IMNSHO.
However, China's leadership is smart enough. China earned some good graces with the Bush Administration by allowing for the 'float.' But, this float is thin -- as it should be.
The basket of foreign currencies is now being used by China instead of just the US Dollar. The position of the US influence just took a massive step back into the middle of the pack.
America should be the place where others try to hitch to. American should be the shooting star of properity. America should encourage others to tie their energy upon our momentum.
The way to ease the huge US trade feficits is to make better stuff. We need to be the place for the best and greatest. We need to be about the most modern, effective and efficient systems and outcomes.
The move allows American laggard survival and lessens the level of the quality of life for the American family.