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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Freedom Fighter who wrote (66429)	8/19/1999 1:10:00 PM
From: Les H	Read Replies (1) \| Respond to of 132070

Fearing Deflation, China Orders Ban on New Factories nytimes.com

To: Freedom Fighter who wrote (66429)	8/19/1999 1:18:00 PM
From: RealMuLan	Read Replies (1) \| Respond to of 132070

Wayne: I don't know how long you have followed Stratfor.com. They have been chanting this even since the end of 1997. Yes, the economic problems in China are severe, and hard to deal with. The bottom line is that the Chinese consumers do not want to borrow money. Most of them buy apartment with cash, believe it or not. Not much the government can do about it. This is a cultural thing. Devalue? possible, but not imminent. I think Julius Wong (a SI member) has a better indicator for whether China will devalue its currency, which is the difference bet. the exchange rate on Shanghai black market and the official exchange rate. When this rate is 20% higher than official rate, then the devalue is very likely, and now the difference is 8%. So his conclusion is unlikely. I agree with him on this. FWIW

To: Freedom Fighter who wrote (66429)	8/19/1999 1:27:00 PM
From: Knighty Tin	Respond to of 132070

Wayne, the reports are right, though the Chinese muckety-mucks will lose a lot of face if they devalue after saying for years that they will not. My opinion has been that, de facto, it is a done deal. But they may be able to weasel a Clintonesque semantic argument that allows them to call it something other than devaluation. So, China and Japan are sucking wind, but Asia is recovering? Au contraire, polar bears. <g>

To: Freedom Fighter who wrote (66429)	8/19/1999 1:47:00 PM
From: Timothy Liu	Respond to of 132070

If you are a follower of stratfor, then you no doubt read this article about how China does devaluation without officially devalue RMB (which is a closed currency). This is done through tax rebate for exports which effectively lower the cost of export products. I wouldn't bet on devaluation. To CCP, saving face is more important. Tim China Talks About Devaluing the Yuan, Months After They Did It stratfor.com