US to delay China currency report

© AFP/File

AFP

WASHINGTON (AFP) - The US Treasury Department on Friday said it would delay a report that could label China a currency manipulator until at least May, after a series of top level meetings.

The semi-annual report, which was next due on April 15, has become a focal point for critics who accuse Beijing of unfairly keeping the yuan weak against the dollar to boost Chinese exports.

The US government said it would wait until a meeting of the G20 finance ministers and the IMF's annual spring meetings this month and a bilateral meeting in May before publishing the document.

The last report -- which also deals with the currency policies of other trade partners -- was published in February, after a delay of four months.

The report stopped short of labeling China a manipulator, a move which could have resulted in punitive sanctions on Chinese trade.

© AFP -- Published at Activist Post with license

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Obama claims strengthened hand in global dealings

image/Reuters

David Werner
Associated Press

YOKOHAMA, Japan — President Barack Obama claimed a stronger hand on the world stage Friday despite electoral defeats at home, failure to get a free-trade agreement with South Korea and lackluster international support for his get-tough policy with China on trade and currency disputes.

"It wasn't any easier to talk about currency when I was first elected and my poll numbers were at 65 percent," Obama argued at the close of the G-20 summit, after bluntly accusing Beijing of undervaluing its currency.

The president flew to Japan for the APEC summit without the coveted trade pact with Korea or a united front with other countries against China's currency policy. He also endured a gusher of criticism from other countries about a decision by the U.S. central bank to pump $600 billion into the U.S. economy, something China, Germany and others believe could weaken the dollar and lead to inflation.

After the talks here beginning Saturday, Obama will return to the U.S. to confront Republicans empowered by their gains in this month's midterm elections.

Even so, the president contended that his standing with world leaders is not diminished.

"When I came into office people might have been interested in more photo-ops," the president said, because of the "hoopla surrounding my election."

But he contended he has now developed genuine friendships with leaders including Indian Prime Minister Manmohan Singh, German Chancellor Angela Merkel and South Korean President Lee Myung Bak – and even Chinese President Hu Jintao.

"That doesn't mean there aren't going to be differences," the president added.

Those have been on stark display throughout the G-20 summit, which resulted in a final document in which leaders agreed on various measures to achieve economic stability, none of them enforceable or specific.

Obama contended this constituted victory nonetheless, even as he acknowledged that America's place in the world has changed – and even if he wouldn't say his had.

Whereas the U.S. had been the dominant superpower, "We are now seeing a situation where a whole host of other countries are doing well and coming into their own and naturally they're going to be more assertive ... and that's a healthy thing," the president said.

Obama told a news conference here that progress was made in stabilizing and strengthening the global economy, saying it is now back on "the path of recovery." But he also said that nations "risk slipping back" into peril if they don't work harder to foster sustained growth, end unfair trade practices and currency manipulation. Obama argued that "countries with large surpluses must shift away from unhealthy dependency on exports" and said that exchange rates "must reflect economic realities."

China's currency "is undervalued," the president declared, adding that Beijing "spends enormous amounts of money" to keep the yuan in that condition. He said that it's critical for China, "in a gradual fashion," to let markets set the currency's value.

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The currency war is phoney

At the US recession's core is a collapse in investment. America should sort out its own economic policy, not attack China's

John Ross
Guardian

The core of the "currency wars" – in which China has been accused, primarily by the US, of undervaluing the renminbi to boost its exports – is a simple piece of arithmetic. The US has only a quarter of China or India's population.

America can remain the world's largest economy only if average Chinese or Indian living standards never exceed 25% of its own. As – rightly – China and India will never accept this, a peaceful global outcome therefore requires the US to abandon its undesirable and impossible goal.

The immediate political background is September's vote by America's House of Representatives threatening China with tariffs unless it increases the exchange rate of its currency. Speaker Nancy Pelosi claimed the legislation was a "key part of our Make It in America agenda", arguing that forcing China to revalue the renminbi, thereby increasing the price of its imports, "could create a million US manufacturing jobs". The dollar's exchange rate then slid as the Federal Reserve accepted quantitative easing – that is, printing dollars – and central banks, including that of Japan, intervened to try to drive down their currencies against the dollar.


Pelosi does not seem to appreciate, however, that the US cannot profitably produce the goods it imports from China. If tariffs were imposed, similar low-price products would be imported from India or Mexico. No American jobs would be created. Indeed, a trade war would lead to a net loss of American jobs. Any country hit by tariffs invariably reciprocates, and China would act against competitive US industries such as farm products and hi-tech.

American politicians are to some degree seeking a scapegoat for domestic problems – the equivalent of Nicolas Sarkozy's anti-Roma campaign. But if the long-term goal of the US to remain the world's largest economy is neither just nor achievable, it can engage with a perfectly legitimate concern – ensuring its population has the highest possible living standards.

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Currency Wars: The Phantom Financial Menace

AgentOgden Illustration

Giordano Bruno
NeitherCorp Press

War, almost every kind of war, is first and foremost a production. A piece of live-action theater with “good guys” and “bad guys” delineated by governments and by media for the benefit of the masses. Most plot-points in most modern conflicts are not genuine. They are written and staged (Gulf of Tonkin, or WMD’s in Iraq anyone?), though we treat the fairytale as if it were reality simply because the story is being told by some corporate mouthpiece wearing a fake smile and a suit on our TV. Very often, we discover after the fact that the wars we witnessed in the dark shadows of our cultural cinema with greasy popcorn and mega-large soda in hand were actually a charade, a farce. We get angry, we get livid, and then we go on with our menial lives because the “damage is done” and what can we do about it now anyway? Very rarely in history do the majority of people have the ability or occasion to see the authentic war going on right in front of their eyes, between the social puppeteers, and those who have broken loose from their strings.

Today, we as Americans have a rare opportunity to step outside the theater, away from the fabricated pageantry of a particular conflict barreling down the horizon, and examine the situation objectively before it fully develops. That conflict is the now increasingly aggressive “global currency war” being readied for implementation and public consumption at this very moment.


For now, the threat of a large scale currency fight is being presented as “minimal” but potentially relevant. In fact, the war has been slowly taking root since at least 2008, right after the initial collapse of the mortgage derivatives bubble when the private Federal Reserve lowered interest rates to near zero and began openly purchasing U.S. Treasury debt. Only this past month has the MSM finally begun discussing the wider implications of these measures, along with the obvious reactions of other nations, including the escalation of trade wars into a full fledged fiat battle royale. But all is not what it seems…

As I hope to demonstrate clearly in this article, not only is the currency war threat utterly unnecessary, irrational, and fiscally pointless, it is also completely engineered to serve a purpose beyond the policy directives of any one sovereign nation, and meant to benefit only a small handful of financial elite…

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