Thursday, April 27, 2006

If you scratch my back...

Greetings China. My name is Ben. Say, we have this problem, or at least its a perceived problem with my boss (whom I serve at the pleasure of...whatever that means). Your currency is too high. I get nervous about something called the current account deficit. This is an economic relic from the days when currency was readily convertible to gold. We still get freaked out by big deficits because we think that someone will sell all of their U.S. dollar denominated assets (thereby depreciating the dollar, and appreciating their own currency).

So, I will tell ya' what. You increase your interest rate, and I will stall this rabid beast we call "wall street" until your economy can cool off a little (hey, mutual benefit right buddy??) and your currency weakens to a level we both feel comfortable with. I will say something like "the Federal Reserve may decide to take no action at one or more meetings" or something like that...because you know if I keep raising rates, our currency will appreciate and our current account deficit will continue to grow...and I just don't like seeing those numbers like that.

so whaddya say???

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