Saturday, December 12, 2009

Senator Harry Reid accuses the Chinese

Senator Harry Reid is accusing the Chinese government of unscrupulous currency manipulation and intellectual property theft. While I can agree on the latter, the currency manipulation accusation seems shallow, considering the Chinese are merely pegging their yuan to the USDollar. Currency manipulation by the US Treasury and the Fed is causing manipulation in the yuan, ex post facto. Reid can't accusing the Chinese of currency manipulation without accusing the US government of doing the same.

Also, it's ill-advised to make blind accusations toward your creditor. They may just stop lending the US government any capital, driving up interest rates in the process. Reid and US Treasury Secretary Tim Geithner should consider changing their accusatory tone to one which is more conciliatory.

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