World News and Trends: Sino-American currency war expected
Most observers of the financial scene are fully expecting a damaging currency war principally between the People's Republic of China and the United States, but extending to the euro and other global currencies.
The Wall Street Journal reports: "The U.S. and China deepened their confrontation over Beijing's foreign-exchange policies, prompting fears that the dispute could undermine economic relations between the world's two largest economies ... The increasingly hostile rhetoric suggests that leaders aren't moving closer to an agreement over how best to address the issue" (Damian Paletta and John Miller, "China, U.S. Step Up Fight Over Currency]," Oct. 7, 2010).
Reuters columnist James Saft put it this way: "China is so adroit in melding diplomacy, jawboning and action to keep the value of its currency low, that you have to feel something approaching compassion for the plodding adversaries from the United States, Europe and Japan" ("China's Skill Is Breeding Frustration," International Herald Tribune, Oct. 6, 2010, emphasis added throughout).
The recent fall of the dollar offers no encouragement in effectively marketing potentially lucrative exports. The Wall Street Journal reported that "the U.S. dollar touched record lows against several currencies [Oct. 7], adding to already high levels of strains between countries competing in the financial markets to keep their export markets competitive ... As [the] dollar weakens, talk of a 'currency war' is building" (Tom Lauricella, "As Dollar Falls, No Clear Path Toward Stability," Oct. 8, 2010).
The Financial Times also expressed its concerns: "If the world is on the brink of an out-and-out currency war, a variety of battalions has been out on manoeuvres in the past few weeks. The Bank of Japan ... has launched a fusillade of intervention to hold down [Japan's currency] the yen in foreign exchange markets ... The main combatants, the US and China, continued to exchange rhetorical salvos" (Alan Beattie, "Global Economy: Going Head to Head," Oct. 8, 2010). The same article noted that, according to the managing director of the International Monetary Fund (IMF), "There is clearly the idea beginning to circulate that currencies can be used as a policy weapon."
Recent diplomatic pressure by the European Union (EU) to persuade China to let the yuan rise to ease the situation has been met with strongly stated rebuffs voiced by Chinese Premier Wen Jiabao. Clearly Beijing has the monetary reserves to maintain a relatively weak currency.
Financial Times columnist John Authers sums up the potential risks: "First that a 'loser' in the currency war snaps and resorts to a trade war and second that currency traders get caught as they did in 2008 and lose a bundle. Those losses could cascade elsewhere in the [global] financial system" ("Everyone Will Lose in a Global Currency War," Oct. 10, 2010).
Such developments would compound the fragility of the financial infrastructure around the world, especially at a time when many nations are trying to climb out of the worldwide recession. (Sources: The Wall Street Journal, Financial Times [London].)
An Article from:
Good News Magazine: November - December 2010
Course Content
Jerold Aust
Jerold Aust has served in the ministry for 52 years, as a public speaker for 58 years, a published writer for 38 years, and is employed by UCG’s Media and Communications Services. He is a Senior Writer, interviewer, and editor for Beyond Today Magazine and has taught Speech Communication for UCG’s ministerial online program and the Book of Revelation for ABC.
Jerold holds a BA in theology from Ambassador College, Pasadena (1968), an MA in Communication from California State University, Fullerton (1995), a distance-learning Ph.D (2006), and a Famous Writers School diploma in non-fiction writing (1973). Additionally, he studied post-grad communication at University of Southern California (1995), radio, TV, voice-overs, and Public Relations at Fullerton College (1995-1996), and graduate communication at Wichita State University (1978). Jerold has taught communication at the University of South Alabama (7 years) and ABC (17 years). His published works include, Ronald Reagan’s Rhetoric: Metaphor as Persuasion and EZSpeakers: Public Speaking Made Easy in 7 Steps. Jerold's overarching goal is to share with humankind its incredible destiny!
John Ross Schroeder
John died on March 8, 2014, in Oxford, England, four days after suffering cardiac arrest while returning home from a press event in London. John was 77 and still going strong.
Some of John's work for The Good News appeared under his byline, but much didn't. He wrote more than a thousand articles over the years, but also wrote the Questions and Answers section of the magazine, compiled our Letters From Our Readers, and wrote many of the items in the Current Events and Trends section. He also contributed greatly to a number of our study guides and Bible Study Course lessons. His writing has touched the lives of literally millions of people over the years.
John traveled widely over the years as an accredited journalist, especially in Europe. His knowledge of European and Middle East history added a great deal to his articles on history and Bible prophecy.
In his later years he also pastored congregations in Northern Ireland and East Sussex, and that experience added another dimension to his writing. He and his wife Jan were an effective team in our British Isles office near their home.
John was a humble servant who dedicated his life to sharing the gospel—the good news—of Jesus Christ and the Kingdom of God to all the world, and his work was known to readers in nearly every country of the world.
