EconoMonitor

Peterson Institute for International Economics

Archive for April, 2010

  • Facing Up to China’s Currency

    Nicholas R. Lardy suggests the Obama administration may avoid labeling China a currency “manipulator” to keep cooperation going on other issues.

    Edited transcript, recorded April 1, 2010.

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  • Renminbi Undervaluation: Any Way You Look at It

    Intellectually, there are two ways of being in denial about renminbi undervaluation. The first is to succumb to what John Williamson has called the doctrine of immaculate transfer. Paul Krugman, in his recent blog posts, has been taking Stephen Roach and Joe Stiglitz to task for doing so: i.e., for their claiming that China’s current account surpluses have little to do with exchange rates and that surpluses are all about savings and investment in each of the trading countries. Specifically, raising savings in China will somehow—magically and automatically—translate into current account adjustments irrespective of changes in exchange rates (hence Williamson’s immaculate transfer metaphor).

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  • How Quickly Will China Move?

    If China does let its currency start rising again, as widely speculated, the overriding issue is whether it will move quickly and substantially enough. The renminbi is undervalued by about 25 percent on a trade-weighted average basis and by about 40 percent against the dollar. No one expects China to curtail this huge misalignment in a single step. But it needs to both make a sufficient “down payment” to be credible and assure that appreciation will continue until the undervaluation has been eliminated.

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  • Germany’s Virtuous Economy: How Much is It to Blame?

    Angel Ubide argues that Germany should rebalance its growth, allow wages to grow, and encourage domestic demand to help countries like Greece, Spain, Portugal, and Italy.

    Edited transcript, recorded March 15, 2010.

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  • Senator Dodd’s Regulatory Reform: A Step Forward

    Morris Goldstein gives the new Dodd proposal a 7.5 rating out of 10, scoring well on resolution authority but less well on pricking future asset bubbles.

    Edited transcript, recorded March 15, 2010.

    Steve Weisman: It’s March 15—the Ides of March—and Senator Chris Dodd, chairman of the SenateBanking Committee, has just released his new proposal for legislation on financialregulatory reform. Who better to discuss it than Morris Goldstein of the PetersonInstitute? This is Steve Weisman at the Institute. Morris, thanks for joining us.

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  • Obama Trade Initiatives Are a Good Start

    The Obama administration has now unveiled its first positive trade policy initiatives. One seeks to negotiate a Trans-Pacific Partnership between the United States and key Asian countries. The second aims to double US exports over the next five years.

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