Saturday, March 20, 2010

China 3

For more on the Krugman (and C. Fred. Bergsten) stand on China and its undervalued currency see The Political Economy of Pressuring China, plenty of links there to Krugman's argument and follow ups and rebuttals by others.

And the un-shut-upable Peter Schiff has posted his YouTube response to Krugman. (Again, I'd advise avoiding the comments.) I never thought Paul could create such entertainment.

We all know C. Fred Bergsten, don't we? For about a gadzillion years he pushed a theory that the Japan-US trade imbalance was a result of an undervalued yen. I once had to transcribe one of his speeches for translators, leaving in all the hmm, huh, eh, and everything else. I lost any urge to read/hear any thing more by C. after that. Krugman/Bergsten video here.

Oops. I found a 1991 C. Fred B./James Fallows spat over his yen theory and more:

Virtually every speech on economics by a Japanese government official or Keidanren (big-business alliance) representative quoted Bergsten or Cline. The purpose of the quotation was to show that the strong dollar was the real cause of US-Japan economic problems, so Americans shouldn't waste their breath talking about other issues, such as trade barriers or deep structural differences between the US and Japanese versions of capitalism. Anyone who has met Japanese economic officials in the last five years has heard Bergsten's work referred to in this way... (Note that Fallows was not questioning Bergsten's integrity. You have to read the full article to understand the argument.)


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