Krugman believes appreciation would allow the Chinese people to buy more American exports. But what American exports? Everything is already made in China. America exported its manufacturing jobs years ago.
Friday, November 20, 2009
Everything Is Already Made In China
Nobel Prize winning economist/NYTimes columnist Paul Krugman has been arguing that the Chinese government is severely undervaluing its currency and that this is contributing to the worldwide recession. Krugman says, among other things, that the unbalanced flow of cheap Chinese exports to America would be balanced out with more American goods going to China - if the Chinese currency were fairly priced. I don't pretend to understand all of the economic arguments here, but I was reading a rebuttal in Forbes.com by a Chinese businessman and Forbes contributor Shaun Reign and was amused by this response: