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Strategies & Market Trends : Mish's Global Economic Trend Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Jet.Screamer who wrote (83729)	8/24/2008 2:56:11 AM
From: John Metcalf	Read Replies (4) \| Respond to of 116555

"Is it fair that China and Japan keep their currency effectively pegged to ours to make their exports to us cheap? " Yen has traded freely against all other currencies for 37 years. Renminbi has traded with collars since July of 2005. In what mechanism do you see an "effective peg" vs. USD for either currency? RMB was pegged at 8.27 per USD, and now trades at 6.84. The 21% rise of yuan versus dollar in 3+ years is not insignificant. Who thinks there is still a peg? When I lived in Japan, yen was 360 per USD, in the early sixties. From 1949 to 1972, yen was pegged at 360/USD. When the US abandoned the gold standard in 1971, yen traded freely and has now appreciated to 110 per dollar. I can't imagine why people can't see the decline of USD when they look at exchange rates! Beyond that -- why are people demanding a further decline in USD, and accusing other countries of dollar pegs which no longer exist?