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Posts Tagged ‘weak yuan’

The euro zone has been looking to China play a role in supporting its rescue fund by investing some of its $3.2 trillion in foreign exchange reserves — the world’s largest. China cannot barge in and flash wads of money and say, ‘help yourself, folks’ So Hu Jintao has to play a subtle game. In politics a Good Samaritan has one hand extended to pick you from gutter and with the other to chain you forever play second fiddle to his whims. Morality of the parable and hard reality of politics are altogether different. When the Chines finance minister announces ‘China has always supported Europe’s response to the international financial crisis and its economic recovery efforts,” already there are fellows back in Beijing toting up for how much Europe has to pay for China’s help.
Europe can sit back and think of the adage.’Beware of the Geeks bearing gifts.’ EU member Greece has tossed its problem into the lap of Euro block and is now the crisis of eurozone. China has to make moves carefully. If Europe is bruised and cannot afford its melamine laced milk, cough syrup cereals, meat products and toys with deadly paints where would it dump all the shoddy goods? Africa is one place where it can but there is still surplus that must be got rid of. Perhaps Europe? Sure China has now made some sounds tuttutting its sympathy at Europe’s crisis. Let us watch how a nation with poor record of human rights will crack its bullwhip.
It is worthwhile to study how superpowers go out in ignominy or watch the pretensions of a nation in a hurry. China has the USA for a debtor. Now Europe. Here is a chance to score a point where Europe is bending backwards to come up with some solution.
PS. Italy Portugal,and Spain are now watching how they shall make their crisis the crisis of Eurozone.These also shall come. A global economic meltdown seems to be in the cards. Am I being pessimistic? Only time will tell.
benny

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