I hate data comparisons without consistent y axes
I hate data comparisons without consistent y axes
But the scales aren't the same on each graph, Japan has a final value of 1.2 while China is 1.5 but comparing the graphs by sight gives the impression Japan has a final value 3x that of China. Each graph should be normalized to the same scale if the intention is to compare the graphs against each other.
Japan's been doing "dirty float" since '73 to keep its exchange rate low, and have been reaping the benefits of the Plaza Accord for almost 40 years now to keep their exchange rate floating around 100-to-1 for USD and massively overinflating their asset values, but nobody writes op-ed polemics about it like with China, because Americans fucking LOVE cheap Japanese import cars and electronics.
And it scales randomly. Brazil and Japan look comparable even though they're 10 points apart.
From “Communism never works” to “Communism is literally the only thing that works”. Lmao the immortal science keeps on winning.
The US allowed one million deaths for the sake of the economy but it turns out that it's even better for the economy if a million people don't die
Woah, almost like the backbone of all human experience is the labor of the working class. And killing them causes issues with that.
Buying yuan to protect my savings from inflation - super online commie dumbass move, or financial genius?
Death to America
A good idea so long as you don't get locked out of it due to sanctions imposed by a flailing empire.
I plan on moving to China eventually anyway so I should be good, right? Assuming I don't get locked out of that too
Death to America
I wouldn't count on that as a way of fleeing America. They issue a very low number of permanent residencies, but maybe that will change in the future.
I don't need a permanent residency though. I'm just gonna teach English and vibe for as long as I can basically. Eventually I'll have to leave if I want to retire but who even knows if I'll live that long lol. Also if you marry a Chinese national and have kids you can stay in China until the kids are 18 even if you aren't a citizen, and where better to raise my hypothetical kids than china?
Death to America
Just because commodity prices are stable within a country, doesn't mean the relative performance of its currency to USD will outperform inflation within the US. Might be wrong on that, but it doesn't seem like those should be correlated necessarily, at least not very strongly.
Making up numbers for the sake of example:
If 7 RMB buys 1 USD right now, and for the next 10 years USD inflates at 10% per year and RMB inflates at 1% per year, then by definition after those 10 years, 7 RMB will buy more than 1 USD, no? How could the difference between the two currencies' inflation rates not impact the exchange rate between the two? All else being equal of course - there are other factors besides inflation that impact exchange rates. Genuine question, I know nothing about finance, despite having gone to b*siness school
Death to America
If 7 RMB buys 1 USD right now, and for the next 10 years USD inflates at 10% per year and RMB inflates at 1% per year, then by definition after those 10 years, 7 RMB will buy more than 1 USD, no?
No, because price levels are not the same across countries and they don't stay proportional over time. Currently you need about 4.20 RMB to buy an equivalent basket of goods in China than what 1 USD buys in the US, not 7 RMB. This measure is the "purchasing power parity" exchange rate, and is usually below the nominal exchange rate for imperialised countries and above it for the imperialist countries. The OECD has a table of the PPP exchange rate for several countries here: https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm
It's an essential part of the unequal trade relations that keep globalisation going. In practice, when you travel to China, you'll notice that you can buy twice as much stuff there than what you could back home. And conversely, a Chinese person travelling to the US will find everything twice as expensive. These relations can change quite rapidly, for instance in Argentina we had a PPP exchange rate almost on par with the nominal in 2015, despite persistently high inflation, when the government managed to turn the country into one of the least indebted in the world, but immediately afterwards a rightist government took the biggest IMF loan in the history of the institution, defaulted on it, crashed everything and now the PPP is three times below the nominal exchange rate, and again an American can come over here and buy everything, like in that scene from Eurotrip.
Depends on the exchange value but broadly speaking it's a bad idea to hold a lot of currency in an inflationary economy anyway
"BUT CHINA IS ARTIFICIALLY MANIPULATING THEIR CURRENCY" :wojak-nooo:
It's a protectionist move. It makes foreign products harder to buy, encouraging everyone to buy local instead. It also makes it easier to export, albiet at the cost of some profit margin. For a big, diverse economy like China's, it would be the smart play no matter what your ruling ideology is, which is precisely why the "free market" ideology of American hegemony is so strongly opposed to it.
almost all currencies have to be "manipulated" because the dollar is heavily manipulated. if you dont weaken with it your export industry gets fucked.
How about any scale at all lmao. There's only one point for reference, the graph might as well be a scribble.
China I assume is just absorbing prices of commodities for its citizen. Wtf is happening with Japan? They're like a neoliberal hellhole, and aren't energy independent from what I can tell. What did they do?
Japan is the most sensitive economy in the world to inflation. 1.2% is time to start entering panic mode for them
I'm not sure about that, it seems like the Japanese government has been actively trying to get inflation up, and 1.2% is still too low (at least according to the common wisdom that central banks follow). And idk, in a time of supply chain shocks and spiking energy costs maintaining <2% inflation is probably not panicking anyone.
Let me clarify:
The Japanese public is the most sensitive to inflation. Trends that look beyond control of the Bank of Japan are quite troubling sights, and therefore it is quite tightly managed
presumably because it's the mirror of the us. japan is still dependent on neocolonial production in the third world, only they don't actually own any of it like the us and europe do.
Interesting. I wonder why it's lower. Wouldn't oil prices affect them just as much? Maybe gas is a smaller weight in their CPI if less people there drive?
The also have more renewable and nuclear power than most of their piers combined
Yep, more hydropower and more renewables. Also far more coal too, which is not ideal; but way less crude and natural gas which is why they're weathering the current storm.
