benlehman

huh. Most US hostels wouldn't be more than $20. Maybe you'll be able to find better prices when you're actually on the ground? That is strange.

And wow, 20 yuan, for a dorm room? That's cheap as fuck.

The US would probably bounce back pretty fast. Most of our imports from China are still light manufactures. Those industries can move pretty easily.

I dunno, I think China is taking a big risk. A lot of countries try to keep their currencies artificially low - the US arguably did so from 1945-70. But there are a lot of differences - the US was selling to its own markets, its currency was strong when it started, it didn't have to play too many weird games to keep its currency low. And we still took a major hit when Nixon revalued the dollar.

China is largely exporting. Its effectivelly exporting its natural resources at a reduced price, which will do God knows what to its natural resources. The rate China has chosen for the Yuan isn't just low, its extremly low. And its keeping the Yuan low by, for all intents and purposes, shorting the Yuan againist the Dollar. Its insane. What the hell do they do if the US decides it wants a little inflation?

Anyway, sorry for ranting. The whole thing makes me very nervous. I worry that they're going to put off the devaluation for too long, so that when they do revalue, the tremors really do fuck the world economy.