Yes, in fact, their premise is probably false.
The basket of goods and services that are the base to calculate CPI
will change along time. Food will be less and less im****tant as the
country grows. Therefore, the current cause of inflation will
disappear or will have declining impact.
As the Chinese market is large enough, we are (and if we want we will
be) reasonably isolated from those capitalists (financial funds). The
real cause of price inflation will be financial (excess of liquidity)
or productivity.
About the financial causes, the peoples bank has a lot of roo to cut
interest rates, to cut bank reserve rates, etc. therefore growth will
not be at risk due to financial reasons. Price inflation? As far as we
have a long term trend that does not make our productivity lower than
developed economies, that inflation will be acceptable and probably
unavoidable.
Our true challenge is the second reason, productivity. It is related
mostly to managerial skills and technologic skills. Our economy grows
very fast, but to produce people with the apropiate skills to lead it
take many years (managers doubfully can lead a medium size company
until they are 30 years old). Education centers cannot produce skilled
people fast enough to follow the pace of the economy.
USA had a similar issue at the end of WW2. They skiped the problem at
that time hiring foreigners from Germany and Japan (and also fromsome
other countries). The cost has been that step by step, the US
edication system lost any quality standard and now is unable to
produce competitive professionals, nowadays they have to im****t above
50% of them.
China has done that with Russian scientists. But it is not helpful for
companies and the Russian mine is now empty. Will we repeat the US
model hiring foreigners? The government is not doing that, until now
(with some exceptions) we rather prefer to hire advisors and to give
Chinese professionals the op****tunity of making mistakes. Also, the
open mind that the government shows letting Chinese people to study
and work abroad, will give us the op****tunity to hire them back once
they have achieved the apropiate skills or when China can offer a
similar (or better) standard of life.
Until now, that policy is working fine enough, but it is still a
challenge.
Peace and best wishes.
Xi
On Apr 5, 8:38 pm, Raymond <ni...@[EMAIL PROTECTED]
> wrote:
> On Sat, 5 Apr 2008 08:50:05 -0700 (PDT), "fyfp...@[EMAIL PROTECTED]
"
>
>
>
> <fyfp...@[EMAIL PROTECTED]
> wrote:
> >On 3=D4=C21=C8=D5, =C9=CF=CE=E72=CA=B101=B7=D6, "ltl...@[EMAIL PROTECTED]
"
<ltl=
....@[EMAIL PROTECTED]
> wrote:
> >> The following is from today's Xinhu news. The author of hte article
is
> >> Visiting Prof in Finance, Xiamen University.
>
> >>http://news.xinhuanet.com/comments/2008-02/29/content_7683740.htm
>
> >> One of his argument is:
>
> >>
=D2=BB=B8=F6=B9=FA=BC=D2=C3=BB=D3=D0=C0=ED=D3=C9=D4=DA=B4=E6=D4=DA=
=BE=DE=B6=EE=CD=E2=BB=E3=B4=A2=B1=B8=B5=C4=C7=E9=BF=F6=CF=C2=D1=A1=D4=F1=CD=
=E2=BB=E3=B1=E1=D6=B5=BA=CD=B1=BE=B1=D2=C9=FD=D6=B5=A3=AC
> >>
=B8=FC=C3=BB=D3=D0=C0=ED=D3=C9=D4=DA=CD=A8=BB=F5=C5=F2=D5=CD=B3=F6=CF=
=D6=C9=F5=D6=C1=BC=D3=BE=E7=B5=C4=C7=E9=BF=F6=CF=C2=BC=CC=D0=F8=D1=A1=D4=F1=
=B1=BE=B1=D2=C9=FD=D6=B5=C9=F5=D6=C1=BC=D3=CB=D9=C9=FD=D6=B5=A1=A3
> >>
=CD=A8=BB=F5=C5=F2=D5=CD=B5=C4=B3=F6=CF=D6=CA=C7=B1=BE=B1=D2=D3=C9=C9=
=FD=D6=B5=D7=AA=CF=F2=B1=E1=D6=B5=B5=C4=B7=D6=CB=AE=C1=EB=A3=AC=D5=E2=CA=C7=
=D6=C6=B6=A8=BB=E3=C2=CA=D5=FE=B2=DF=B5=C4=B3=A3=CA=B6=A1=A3
> >>
=C3=E6=B6=D4=B3=A3=CA=B6=A3=AC=CE=D2=C3=C7=B2=BB=D3=A6=B8=C3"=B4=B4=D0=
=C2"=A1=A3
>
> >> A country has no reason to chose foreign reserve's depreciating and
> >> its own
> >> currency's appreciation when it has hugh pile of foreign reserve. It
> >> has less
> >> reason to appreciate its currency when inflation has appeared or
> >> accelerating.
> >> The appearance of inflaiton should be the watershed between
> >> appreciation and
> >> depreciation. This is common sense in exchanging rate policy making.
> >> In the
> >> face of such common sense, we should not "innovate."
>
> >> Comments?
>
> >Albert Fung seems to think differently from this Chinese economist. I
> >think we should let the market decide whether or not RMB should
> >appreciate or depreciate.
>
> Change the word "market" with the word "capitalist", you got the real
> intent of those so called economists.
>
>
>
> >The appreciation of RMB reduces ex****t, which makes the government's
> >macro measure to cool down the economy more operative. As a matter of
> >fact, where I live the properties prices have dropped by 30-40% after
> >hanging on a plateur for a few months...
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