China exports like a trillion dollars of value more than it imports, and it seems to actively maintain this stance - Does it? And if so, why? My reductive ape-brain says if more goods are leaving your country than coming in, then other countries are accumulating actual goods, and your country is accumulating pieces of paper (or digital bits). Seems like a losing strategy.

Why not just make all the goods that your country wants (especially if you're an enormous country that can scale economies and has access to strategic materials like China) and then you'd have more stuff?

And how do currency exchange markets fit in? I thought exporting and importing and fluctuating value of currencies meant that it should all sort of 'balance out' in the end. Because prices of currencies change the value of export/import and consequently you'd eventually have a country that exports and imports the same value of goods.

Maybe I fundamentally misunderstand the purpose of trade. Or maybe I've been playing too much Victoria 3.

  • Avengermate [none/use name]
    ·
    2 years ago

    This gives China a decisive advantage because it underprices their goods. Nobody can beat their prices. The "real" rate of USD to CNY should be around 4, but they keep it pumped up to around 7.

    As an American it's just weird seeing a government take actions that benefit itself.

    • notceps [he/him]
      ·
      2 years ago

      Eh, I wouldn't sign that, under pricing your goods is obviously going to help in maintaining the trade imbalance but it also comes with serious negatives, the biggest one is that they have almost no control over their own currency policy and the other one is that they need to have massive amounts of reserves, like there's a reason why a country like china that knows that is in conflict with the USA still is the biggest owner of US debt that is at risk of just getting eliminated.

    • hexaflexagonbear [he/him]
      ·
      2 years ago

      What? Lol. You have to be insane to make the claim that America doesn't take actions to benefit itself.

      • SaniFlush [any, any]
        ·
        2 years ago

        I think Aven meant “take actions which benefit citizens besides the ruling class”