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Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Bruce L who wrote (213072)	1/15/2007 2:56:29 AM
From: Elroy	Respond to of 281500

msnbc.msn.com China's exporters suffering due to currency rise Companies struggle to cut costs, design higher-margin products Updated: 6:34 p.m. ET Jan. 14, 2007 BEIJING - Dependent on exports to the United States, the Hebei Lihua Hat Co. saw its profits wiped out as China's currency rose steadily against the dollar over the past year. Hebei Lihua, which sold 90 percent of its 4 million hats to overseas markets last year, fought back by pushing its 1,800 workers to cut waste and find cheaper raw materials. It tried to boost revenues by introducing a new waterproof hat. Yet even those efforts might be inadequate, said Wang Zhenhao, the business manager for Hebei Lihua, located in Baoding, a city southwest of Beijing.

To: Bruce L who wrote (213072)	1/15/2007 7:21:29 AM
From: jttmab	Respond to of 281500

Thanks. -- often to the point that, once inflation is taken into account, those loans can be repaid for less than they are worth. I'm not sure that's unique to China. These firms pile up mountains of bad debts which probably total about half of China's total gross domestic product. Yet, because profit does not matter and capital is easily attained, these firms can afford to expand operations endlessly. Sounds quite a bit like the "New Economy" of the 90's in the US. If I made a guess as to what China will or won't do I'd have to admit it to be the equivalent of throwing darts. I'll decline to make any guesses as to what China will do or not do in the future. But I do wish them well. The economies of the US, the EU and China are so intertwined that if any one of them goes down the toilet they all go down the toilet. jttmab