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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (2716)	3/2/2004 6:09:55 PM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

China: Productivity, Inflation and Exchange Rates Andy Xie (Hong Kong) ... "Stability First In an environment of high productivity and high employment growth, exchange rate stability is vital, in my view. Adjustments against shocks could be absorbed via different distributions of productivity among labor, capital and consumers. Volatile real but stable nominal variables are the key to rapid economic development, in my view. This is totally opposite to the post-WWII central banking philosophy that emphasizes adjusting interest rates and, hence, exchange rates frequently to achieve a balance between inflation and growth. In a high productivity growth environment, inflation is not the challenge – asset bubbles are. I think that China has stumbled onto the right approach for macro management in the new era of high productivity growth." Message 19867733 morganstanley.com