A stronger yuan? Becareful what you wish for.

A stronger yuan will mean: More costly goods as import mfg cost go up; China losing more money on $1.4 trillion lent to US which will require much higher interest rates to fund US deficits; China being able to buy US assets at cheaper prices and outbidding US constituents. So far none of this looks positive for th US to me. Wait, what about international companies starting to manufacture more in the US as oppossed to China because of the stronger Yuan and thereby causing an increase in US employment? Please, currency has very, very little to do with a decision about where to set up manufacturing. companies will set up manufacturing in the cheapest place possible to produce the goods and get them to market. Taking in to account hourly labour cost, taxes, red tape, freight, country incentives, location, unions, govt. regulation etc. I hate to tell you this but China kills anywhere else in the world, not just the US, when considering these investment variables.

A stronger Yuan will likely hurt the US consumer far more than help them. The Yuan currency debate is a smoke screen put out by the powers that be to shift attention away from what they’re doing on to others. This is called a red Herring.

- Oz

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