Debate on the above topic is heating up. Paul Krugman has a simple and yet scathing blog post on the topic of renmimbi undervaluation. See here. It is unlikely that he would be invited to China again. He links to this article in NYT which refers to President Obama’s comment on the Chinese currency:
to make sure [...]
One of my friends forwarded me this blog post by Paul Krugman and asked me what Paul meant by ‘that right now the United States has nothing to fear from Chinese threats to diversify out of the dollar’.
What he means is this:
If China sells dollars and puts the proceeds into other currencies, it helps the [...]
If China convinces Asian nations that SDRs will evolve into a reserve currency with a yuan weighting, “then it may make sense for countries in the Asian region to start thinking right now about holding the yuan as a reserve asset,” Prasad said. “It’s a very clever way of trying to use something that everybody [...]
The dessert – the Fed chairman
The Gold Standard (TGS) does not believe that history repeats itself exactly, much less, economic history. So, TGS won’t bet on Japan’s deflationary outcome being repeated in the U.S. even though in many other respects, the US has taken many leaves out of Japan’s book.
That said, premature paeans are being [...]
Extra serving: the battle continues in Op-Eds
It may be a digression but Gold Standard (TGS) must record here the profound distaste he felt when he first read the ‘triumphalist’ Chimerica piece by NF and a co-author. It appeared to have been written in the early part of 2007 but appeared in a journal in December [...]
Main course 2 – joint serving by both
What is interesting is that PK himself provides a possible angle.
The only thing that might drive up interest rates—and this is a real concern (emphasis mine) – is that people may grow dubious about the financial solvency of governments.
NF was quick to latch on to that:
Well, if [...]
Main Course 1 – served by Niall Ferguson
Here is where you can find the transcript of the panel discussion.
This is what NF said in that panel discussion:
There is a clear contradiction between these two policies, and we’re trying to have it both ways. You can’t be a monetarist and a Keynesian simultaneously—at least I can’t [...]
The appetizer – ‘Crowding out’
It all started with Krugman (PK) posting this on his blog. He sighs, expresses exasperation with Niall Ferguson’s ‘ignorance’ and alludes to some ‘dark age of macro-economics’. Strong stuff. Link here.
In fact, there is some history to this. PK, perhaps, was having this at the back of his mind when [...]
Most commentators have either gloated over or bleated at the paper that the governor of the People’s Bank of China posted on the central bank’s web site, calling for a super-sovereign reserve currency. The truth, as always, is duller. I shall refrain from saying more here as I intend to develop my arguments fully for [...]
Paul Krugman has been hammering away at the absence of co-operation from European nations on stimulating their economies. Perhaps, if he had seen this news item in FT, he would have had second thoughts. The article header, ‘Eurozone consumers defy gloom‘ leaves no one in doubt as to the content.
Again, thanks to Paul Kedrosky, I [...]
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