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Democracy & Technology Blog Yuan yawn…Status quo for now…

When the biggest two news items during President Bush’s China trip were his bike ride and his attempt to exit a locked door, it’s clear any contentious conversations happened, well, behind that locked door. This is good news, especially on China’s currency, the yuan. Both the U.S. and China reiterated their basic views, without directly contradicting the other side. President Bush said in his press conference with President Hu Jintao that “We’ll continue to work with China to help implement its July commitment to a flexible, market-based currency.” But Yi Gang, an assistant central bank governor, said that “China would keep the yuan basically stable….” The status quo of stable exchange rates is good for now, though at some point the U.S. will have to wise up, accept this arrangement (if not endorse it), and take a stand against the masochistic Schumer-Graham tariff legislation, which seems to rear its ugly head every other month.
-Bret Swanson

Bret Swanson

Bret Swanson is a Senior Fellow at Seattle's Discovery Institute, where he researches technology and economics and contributes to the Disco-Tech blog. He is currently writing a book on the abundance of the world economy, focusing on the Chinese boom and developing a new concept linking economics and information theory. Swanson writes frequently for the editorial page of The Wall Street Journal on topics ranging from broadband communications to monetary policy.