设万维读者为首页 广告服务 技术服务 联系我们 关于万维
简体 繁体 手机版
分类广告
版主:股民甲远古的风
万维读者网 > 股市财经 > 帖子
On persistent trade imbalance
送交者: jingchen 2018年04月02日06:21:48 于 [股市财经] 发送悄悄话

On persistent trade imbalance


According to standard economic theory, a country running a trade surplus will see its own currency appreciated, which drives up its cost until a trade balance is reached. If the exchange rate is fixed by the government, it needs to print extra money to neutralize the inflow of foreign currency. The increased domestic money will drive up its cost until a trade balance is reached. But a more detailed analysis will show that under certain conditions, trade imbalance can persist for a long period.

The appreciation of domestic currency  will increase its purchasing power. Most domestic residents, including labor, will benefit. However, if the trade balance is restored soon, there will be no easy money to be made for the capital. From the perspective of the capital, it would prefer to maintain trade imbalance as long as possible. This can be achieved through the retention of most trade surplus to capital. This will keep the labor cost remain low. In this way, competitive edge is preserved. However, this practice will harm, or at least reduce the benefit of the labor. It can only be achieved in a society where capital is more powerful than labor. By contrast, in a society when labor is more powerful, trade surplus cannot be expected to last, for the benefit of competitiveness is shared by the whole population, which increase labor costs. 

After WWII, US was the dominant force in economic output. It initially had huge trade surplus. However, the rapid rise of workers’ salaries soon caused trade to balance, then to deficit. In China, the trade surplus has persisted for a long time. This is because capital is more powerful in China. Most trade surplus goes to the capital, which parks much of its surplus in US government bonds. 

Jamie Galbraith stated that the persistent trade imbalance is caused by persistent buying of US bonds by foreign entities, such as Chinese government. This is certainly true. The average Chinese is still rather poor and has to work very hard. If ordinary Chinese people as a group are powerful, they will demand the surplus to be directed to domestic causes instead of parking in foreign bonds. The very fact that the Chinese government can spend large sum on US bonds indicates the power of capital, or the lack of power of labor in China. 

Who benefit from such an arrangement? First, it is the capital from China, whose owners structure this system. Second, it is the capital from US, which co-structure the system. Judging from the return of US capital markets and the pay of top executives, the capital from US does very well in last several decades. Third, US consumers, who enjoy low cost on most goods. Some might suggest labor in China also benefit from the system. This is in comparison with an earlier era when majority of Chinese people were slaves. 

In this trade system, Chinese labor input hard work and receive all the pollution, US government pays the products with a piece of paper with a big number on it. Certainly US benefit from such an arrangement, as pointed out by many people. If so, why US government complains about it? Well, it can squeeze even higher margin from such a system. After all, the capital from China has been immensely profitable.  

0%(0)
0%(0)
标 题 (必选项):
内 容 (选填项):
实用资讯
发龙药业大回馈!美国专利骨胶原、活心素、灯盏素、排毒养颜宝购买两疗程免费邮寄中国
天天养生,保健礼品,物超所值,疯狂现金折扣,直销美加,港台,大陆,东南亚
最劲爆,最给力美国专利产品<骨精华>消除关节痛、骨质疏松<心血通>预防心肌梗塞
免开通费,30天免费试用中文电视万花筒, 无捆绑服务,月费5.99
西洋参、羊胎盘、鱼油卵磷脂200多种送礼自用健康佳品,全部特价!由此进入
留美学生医疗保险$39/月,短期访美旅游保险,不需体检无年龄限制
一周点击热帖 更多>>
一周回复热帖
历史上的今天:回复热帖
2016: 拯救经济,需要出怪招
2016: 交易员实战3月第4周结果
2015: 八个值得你一生回味的财富小故事
2015: 金德摩根将与科叶拉合资构建新储油终端
2014: 为什么次贷爆煲对中国可能是好事
2014: 4月15日以前的省税计划
2013: 吐血奉献篇:做自己熟悉的股票
2013: 投资小结 - 在时间和空间里翻滚