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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (11587)	1/30/2009 7:11:56 PM
From: John Pitera	Read Replies (1) \| Respond to of 33421

Hi Tom, As I understand it quite few. To start with having the Yuan trading below it's "natural" level increases prices for all imports from other countries. I was talking with Stocktrash yesterday and I believe it was he who was commenting that someone he knows in the energy patch was doing business over in China, and he was getting hit with an additional 15% penalty -- tax, whatever euphemism you like. He was not happy about the lack of a level playing field. Rightly or wrongly the Chinese were successful over several years in promoted the idea to many global politicians and global macro institutions that China needed these benefits and trade advantages to ensure the rapid growth of the middle class. So goes conventional wisdom, that if the Chinese can not hit critical mass in terms of having a robust middle class, the country would be vulnerable to despotic, totalitarian regime changes that would be worse than the current government. The economic seasons have changed and the economic pain and downsizing is making this previous policy untenable. As VP Biden just stated today, for years the previous administration has not adequately looked after the needs of the American Middle class. There is truth to that statement. It remains to be seen how these myriad different influences and contradictory needs are coalesced into our global economy in 2009. John