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To: TobagoJack who wrote (63023)	4/29/2005 6:55:35 PM
From: Moominoid	Read Replies (2) \| Respond to of 74559

Not quite :) I was explaining that sometimes people get into things they don't understand, or thought they did, or find there are aspects they didn't know were there, and need local knowledge, and "outsourcing" and FDI is not quite as simple or smooth as the average "J6P" or student in intro econ might think. I also said things like "why would you buy assets in a country with a falling exchange rate?" "The question isn't why you would diversify international but why not?" and other suchlike. US pressure on China to revalue is definitely a case of "be careful what you wish for"... That's in Tuesday's class, the final class of the course. The textbook is fixated on overvalued currencies and speculative attacks. I'm going to emphasize the undervalued case more. I put the equilibrium exchange rate on my diagram at 3.33RMB per Dollar - that's the Big Mac PPP rate. None of the other instructors recently do any international econ in the intro class here. I think that is a shame (there are 6 sections every semester, looks like I will be teaching one a year). They probably do a lot less about financial investing than I do too!