A Note on Teaching the Yuan-Dollar Market vis-a-vis China's Dollar Holdings

2012 ◽  
Vol 12 (1) ◽  
pp. 1850254 ◽  
Author(s):  
Jannett Highfill ◽  
Raymond Wojcikewych
Keyword(s):  
Central Bank ◽  
Exchange Rates ◽  
Current Account ◽  
Global Economy ◽  
Present Note ◽  
The Media ◽  
Economic Relationship ◽  
Connecting The Dots ◽  
The Relationship ◽  
The U.S

The economic relationship between China and the U.S. is sufficiently ubiquitous in the media that few students will be unacquainted with the issue. Connecting the dots between China’s export-led growth, current account surpluses, currency peg, and its reserves (whether held by the central bank or in a sovereign wealth fund) is a key task in any undergraduate course that touches on the global economy. The present note proposes a method for understanding the relationship between two items in this list, the currency peg and reserves. Maintaining exchange rates different from equilibrium (as China has done) has consequences for the quantities of currencies that have to be bought and sold. The dollars accumulated have to be held in some form – a fact which also has had far reaching consequences for the global economy. The paper proposes using currency offer curves to facilitate teaching fixed exchange rates to undergraduates. Our method helps students “see” the process of pegging the yuan and the resulting accumulation of dollars.

scholarly journals Resolving the Global Imbalance: The Dollar and the U.S. Saving Rate

2008 ◽  
Vol 22 (3) ◽  
pp. 113-125 ◽  
Author(s):  
Martin Feldstein
Keyword(s):  
Current Account ◽  
Global Economy ◽  
Current Account Deficit ◽  
Aggregate Demand ◽  
Trade Deficit ◽  
Saving Rate ◽  
Trade Surplus ◽  
Trading Partners ◽  
Foreign Governments ◽  
The U.S

The massive deficit in the U.S. trade and current accounts is one of the most striking features of the current global economy and, to some observers, one of the most worrying. Although the current account deficit finally began to shrink in 2007, it remained at more than 5 percent of GDP—more than $700 billion. While some observers claim that the U.S. economy can continue to have trade deficits of this magnitude for years—some would say for decades—into the future, I believe that such enormous deficits cannot continue and will decline significantly in the coming years. This paper discusses the reasons for that decline and the changes that are needed in the U.S. saving rate and in the value of the dollar to bring it about. Reducing the U.S. current account deficit does not require action by the U.S. government or by the governments of America's trading partners. Market forces alone will cause the U.S. trade deficit to decline further. In practice, however, changes in government policies at home and abroad may lead to faster reductions in the U.S. trade deficit. More important, the response of the U.S. and foreign governments and central banks will determine the way in which the global economy as a whole adjusts to the decline in the U.S. trade deficit. Reductions in the U.S. current account deficit will of course imply lower aggregate trade surpluses in the rest of the world. Taken by itself, a reduction in any country's trade surplus will reduce aggregate demand and therefore employment in that country. I will therefore look at what other countries—China, Japan, and European countries—can do to avoid the adverse consequences of the inevitable decline of the U.S. trade deficit.

scholarly journals AI and Industry: Postings and Media Portrayals

2021 ◽  
Author(s):  
Eri Phinisee ◽  
◽  
Autumn Toney ◽  
Melissa Flagg
Keyword(s):  
Global Economy ◽  
Industrial Revolution ◽  
Media Representations ◽  
Media Portrayals ◽  
The Public ◽  
Fourth Industrial Revolution ◽  
Practical Reality ◽  
The Media ◽  
Job Postings ◽  
The U.S

Artificial intelligence is said to be transforming the global economy and society in what some dub the “fourth industrial revolution.” This data brief analyzes media representations of AI and the alignments, or misalignments, with job postings that include the AI-related skills needed to make AI a practical reality. This potential distortion is important as the U.S. Congress places an increasing emphasis on AI. If government funds are shifted away from other areas of science and technology, based partly on the representations that leaders and the public are exposed to in the media, it is important to understand how those representations align with real jobs across the country.

Global Savings–Investment Imbalances: What Role for East Asia?

2007 ◽  
Vol 6 (2) ◽  
pp. 1-13 ◽  
Author(s):  
Anwar Nasution
Keyword(s):  
United States ◽  
East Asia ◽  
Current Account ◽  
Global Economy ◽  
Current Account Deficit ◽  
The United States ◽  
Current Path ◽  
Trading Partners ◽  
Global Shocks ◽  
The U.S

This paper examines the current path of global imbalances and the role of East Asia in addressing these issues. The roots of the problem are the exploding budget deficit and soaring current account deficit of the United States. The twin deficits are being financed by foreign savings including the placement of the massive foreign exchange reserves of East Asia in U.S. dollar–denominated debt, such as U.S. Treasury notes. Solving the imbalances will require corrections of internal and external imbalances by both the United States and its trading partners. How East Asia deploys its reserves could set off a tsunami of sales of dollar-based assets that could disrupt the U.S. and global economy. Sharp exchange rate adjustments (particularly a large fall in the U.S. dollar), and a protectionist backlash against the U.S. current account deficit, are in no one's interest as they could trigger global shocks.

Employing Religious Concepts to Address the Political Situation Post-9/11: The Three Burials of Melquiades Estrada (2005)

2019 ◽  
pp. 133-151
Author(s):  
John White
Keyword(s):  
The Political ◽  
Human Beings ◽  
Political Situation ◽  
The World ◽  
The Media ◽  
The Individual ◽  
Relationship Of ◽  
Good And Evil ◽  
The Relationship ◽  
The U.S

This chapter considers The Three Burials of Melquiades Estrada (2005) in relation to its use of the key Christian concepts of forgiveness of sins and redemption. The central focus of Three Burials is seen as being its recourse to Christian ideas, not only in relation to eternal spiritual questions regarding the relationship of human beings to an all-powerful deity but also in relation to the contemporary historical/political moment. This chapter considers two types of detachment from the world: one in which the individual lives their life in a state of indifference and the other in which the individual exists within a space of thoughtful contemplation. The film moves away from the more normal Hollywood consideration of the world as a space for the contest between good and evil to encourage viewers to question the way in which the Mexican ‘Other’ is (and, by extension, all ‘Others’ are) viewed within the U.S. and represented within the media. Ultimately, however, it is argued the film neglects to consider the economics that underpins the contemporary political situation.

The U.S. Current Account and Real Effective Dollar Exchange Rates

2013 ◽  
Vol 46 (2) ◽  
pp. 213-231
Author(s):  
Joscha Beckmann, ◽  
Ansgar Belke, ◽  
Robert Czudaj,
Keyword(s):  
Exchange Rates ◽  
Current Account ◽  
The U.S

Method of Collecting Exchange Rates for the Calculation of the Value of the SDR for the purposes of Rule 0-2(a)

Policy Papers ◽  
2016 ◽  
Vol 16 (60) ◽  
Author(s):  
Keyword(s):  
New York ◽  
Central Bank ◽  
Exchange Rates ◽  
Federal Reserve ◽  
European Central Bank ◽  
Federal Reserve Bank ◽  
European Central ◽  
Reserve Bank ◽  
Bank Of England ◽  
The U.S

This paper proposes modifications to the method of collecting exchange rates for the calculation of the value of the SDR for the purposes of Rule O-2(a). The value of the SDR in terms of the U.S. dollar is determined daily as the sum of the equivalents in U. S. dollar values of the amounts of the currencies that comprise the SDR valuation basket (as provided in Rule O-1), calculated on the basis of exchange rates established in accordance with procedures decided from time to time by the Fund.1 The current procedures are set out in Decision No. 6709-(80/189) S, as amended by Decision No. 12157-(00/24) S, March 9, 2000 (see Annex), which specifies the method for collecting exchange rates for this purpose. Under these procedures, the relevant currency amounts are converted into U.S. dollars using daily exchange rates that are provided to the Fund by the Bank of England (BoE). If rates cannot be obtained from the BoE, they are provided by the Federal Reserve Bank of New York (FRBNY) and, if not available there, by the European Central Bank (ECB). The BoE, FRBNY, and ECB intend to rely on a new, more robust methodology to provide exchange rates to the Fund after November 1, 2016, and the proposed modifications reflect these changes.

scholarly journals Trinity Strikes Back

2019 ◽  
Vol 19 (197) ◽  
Author(s):  
Serhan Cevik ◽  
Tianle Zhu
Keyword(s):  
Monetary Policy ◽  
Exchange Rates ◽  
Policy Implications ◽  
Price Inflation ◽  
The Core ◽  
Monetary Independence ◽  
The Relationship ◽  
Free Movement Of Capital ◽  
The U.S ◽  
Monetary Autonomy

Monetary independence is at the core of the macroeconomic policy trilemma stating that an independent monetary policy, a fixed exchange rate and free movement of capital cannot exist at the same time. This study examines the relationship between monetary autonomy and inflation dynamics in a panel of Caribbean countries over the period 1980–2017. The empirical results show that monetary independence is a significant factor in determining inflation, even after controlling for macroeconomic developments. In other words, greater monetary policy independence, measured as a country’s ability to conduct its own monetary policy for domestic purposes independent of external monetary influences, leads to lower consumer price inflation. This relationship—robust to alternative specifications and estimation methodologies—has clear policy implications, especially for countries that maintain pegged exchange rates relative to the U.S. dollar with a critical bearing on monetary autonomy.

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