U.S. keeps Japan, China on monitoring list over currency practices

US might as well put basically every country except Ecuador on the list. Just political

so bascially every economy that the US cant be competitive against they just label themmanipulators, doesnt matter the $trillions the US has printed over the last 20yrs. when the US does it its all fine, everybody else does it its currency manipulation

This nonsense goes back to the 1985 Plaza Accords. It's outright protectionism which in turn let our industries fall behind and become globally uncompetitive.

If you support the US and the western allies, then it’s important you do not unload your dollar assets in the years ahead 2025. The next fight is the digital yuan. Russia and China have plans to dump the dollar and go with their local currencies. They have already started with the US treasuries. This is more important than Taiwan which has been just talks since 1995 when Hashimoto Ryutaro was prime minister.

Independence/reunification/ use of force to take back Taiwan/ US arms and protection…these are all rehash and only press statements. Nothing will happen here.

The dollar falling has potential to cause real problems. The dollar dominance is more important than Taiwan, Tibet, Xinjiang, Hong Kong, and Myanmar. The US has not and is not going to win these fights with China but they can with the dollar hegemony. Never mind currency adjustments. Make sure the world reserve currency remains the dollar. That’s how I would deal with China who is fighting an economic war.

US is pushing Japan onto China.

Nice!

Do you mean the US that ballooned their budget frivolously on tanks, supersonic jets, and drones, yet keeping domestic inflation low, because its basically exported out by invading countries who refused to use the petrodollar.

If so, yes, Japan and China are unfair!

What’s fair for the US is usually unfair for the rest of the world.

Not an economist, nor I really understand the terms, and don't really care anyways. But every nation wants it's currency to remain weak by any means possible so they can sell their goods and slow down imports, and if that what the U.S is talking about then they should manipulate their currency as well.

The US is the biggest producer of money in the world and it all comes from thin air!

In 2021 hundreds of millions of dollars worth of equipment was left in Afghanistan by the their military! It is all good when arms makers just get new orders to keep on making money.

The yen's rise adversely impacts the profits of Japanese exporters when their revenues are repatriated.

.....

But no Japanese company wants to ‘repatriate’ profits as it is far better, due to higher returns to invest profits abroad!

The end of American imperialism?

The Biden Administration is correct about stating China is a currency manipulator. Fact. But they are dead wrong about Japan. Put up some solid proof, or just shut it.

Artificially weak currencies are what underpin the Asian export behemoths’ lopsided trade imbalances with the U.S. The yen, won, and yuan should all be around 30% stronger than they currently are.

The dollar is the most sought after currency, you can spend it in any country, without problems

Do you see this? ? ?

What happened to Japan for the past 3 decades of economic stagnation. USA not happy if CCP China or Democratic Japan becomes too wealthy. Plaza Accord 1985.

Let Japan grow, catch up to China and USA. Japan is the only ally in East Asia. S. Korea wants no part in balancing China or Russia. Japan is the only one in your corner against an alliance of Russia and China in East Asia.

Japan needs to be stronger. Militarily and economically to make up for S. Korean weakness and none involvement, to help defend Taiwan and Asia as a whole.

Do you mean the US that ballooned their budget frivolously on tanks, supersonic jets, and drones, yet keeping domestic inflation low, because its basically exported out by invading countries who refused to use the petrodollar.

Sorry, but that is completely incorrect. US corporations, mega conglomerates, media companies, Super PACs etc have been manipulating US legislature/ politics as best they can to keep more money consistently funneling up to the 1% pockets. They do so by trying to keep US Federal regulations low impact or eliminated, and same with taxes on corporate/wealthy individuals. This in turn harms the average American in many states. It was only just recently that the US government pushed for many companies to pay higher wages... after over a decade of wage stagnation, rising costs of living on the poor and middle class (a sign of inflation), and generally making it much harder for the Average American to accomplish their goals in life.

Basic American greed is what is causing these actions, which in turn is affecting the US dollar in the long run, and not for the better for the average US citizen.

In the words of the late George Carlin

"It's called the American Dream, because you have to be ASLEEP to believe it!"

@ReasonandWisdomNippon

Unfortunately, Japan has to chart its own path from now on, the US has always been a negative influence to it.

The sooner the rest of the world dumps the US dollar as the basis of exchange rates the better.

It's about currency not money !

For those commenters that are apparently unaware of the difference .

The Biden Administration is correct about stating China is a currency manipulator. Fact. But they are dead wrong about Japan. Put up some solid proof, or just shut it.

Japan and China are the two largest holders of US bonds. Both hold something close to $1 trillion of these (face value). Both countries buy US bonds for the same reason. Both nations run big trade surpluses with the US. In a true free trade regime the currencies of the nations running a trade surplus should rise in value while the currency of the nation with which they run a surplus should lose value. Money is like any other commodity in that as it accumulates in surplus, such as all the US Dollars China and Japan earn from their trade surpluses with the US, the Dollar should lose value. When that happens the Yuen and Yen would rise in value. As that happened Chinese and Japanese goods would become more costly in trade while those from the US would become cheaper. This should, if left alone, make trade imbalances self correcting as changing currency values act to balance trade flows.

Instead, both Japan and China use all those excess Dollars earned from their respective trade surpluses with the US to buy US bonds. They do this for the specific purpose of preventing US Dollars from accumulating and losing value, which in turn keeps the value of their currencies, the Yen and Yuen, low in value so the terms of trade remain favorable to them, and unfavorable to the US. Do you see how the game is played?

Of course neither nation could play this game if the US didn't run a budget deficit year after year financing this by selling US bonds but the US did this during the Cold War specifically to help build up the economies of Japan, South Korea and Taiwan as a hedge against the Soviets. Now sadly the US seems unable to wean itself off annual budget deficits so Japan and now China take advantage of this to support their own export led growth and I think (though I have seen nothing in writing in open sources to confirm this) that the price of "free trade" with the US is some expectation the nations involved with buy US bonds.

The sooner the rest of the world dumps the US dollar as the basis of exchange rates the better.

What do you plan to replace it with? There has to be a global or "reserve" currency of some sort to support global trade. If it isn't the US Dollar it will be something else and I guarantee you the same problems will exist with any reserve currency.

What do you plan to replace it with?

Cryptocurrencies.

I'm looking forward to the controversy this statement creates.

If you still believe that money is the most valuable form of currency then its time to reevaluate.

In other words, make the dollar stronger so our so- called allies can screw us on trade like they have been for decades, namely japan.

Cryptocurrencies.

I'm looking forward to the controversy this statement creates.

To quote author Gertrude Stein's opinion of Oakland CA, "There's no there there"

They are purely speculative commodities. They are no replacement for a well managed national currency. Who controls the issuance of cryptocurrencies and who is controlling the amount of new issuance to prevent inflation or deflation? A diligent national bank manages a nations currency to control the growth in the money supply to keep inflation low and constant, which is what business and consumers prefer. They all want stability so they can plan. A cryptocurrency managed or more likely not managed by parties unknown has none of these qualities. The kinds of wild swings in value witness with Bitcoin are exactly what business and consumers do not want from a currency.

They are purely speculative commodities.

No, they are currencies.

They are no replacement for a well managed national currency.

I agree. Nevertheless, that doesn't mean that we should keep pegged to the US dollar. Pegging currencies to cryptocurrencies remove any politicization of currencies. It takes that power away from America.

Who controls the issuance of cryptocurrencies and who is controlling the amount of new issuance to prevent inflation or deflation?

No one and no one. They are purely market driven.

A diligent national bank manages a nations currency to control the growth in the money supply to keep inflation low and constant, which is what business and consumers prefer. They all want stability so they can plan.

Which is why Fiat currencies will never disappear.

A cryptocurrency managed or more likely not managed by parties unknown has none of these qualities.

Hmm, this statement clearly shows you don't even understand how cryptocurrencies work. It's interesting you feel that you are then qualified to speak on them.

The kinds of wild swings in value witness with Bitcoin are exactly what business and consumers do not want from a currency.

I'm curious, you seem to think that bitcoin (and remember, I said cryptocurrencies. These aren't one and the same) will always fluctuate even after the coins have all been mined. Please tell us more on this theory of yours.

Anyways, you gave zero reasons why we should not peg economies to cryptocurrencies.

StrangerlandToday  01:04 am JST

I agree. Nevertheless, that doesn't mean that we should keep pegged to the US dollar. Pegging currencies to cryptocurrencies remove any politicization of currencies. It takes that power away from America.

Really? Any evidence on this? Any peer-reviewed articles?

Or is this just you attacking the US again, since you realize you can never become a US citizen?

Because you have absolutely no clue on how cryptocurrencies operate. Zero.

Thanks for the morning giggle!

Really? Any evidence on this? Any peer-reviewed articles?

Oh dear, I hope you didn't think that comment would make sense? How exactly would that work?

Or is this just you attacking the US again, since you realize you can never become a US citizen?

Why would I ever want to move there? Honest question. I literally have zero interest in ever living there. Nice place to visit, but the country is a complete mess.

Because you have absolutely no clue on how cryptocurrencies operate.

Ironically, I'm one of the few who actually does understand how they operate. From the encryption used to sign the individual transactions, to how they're propagated to the blockchain, to how the blockchain has been socially engineered to work without any centralization or operating entity.

Hmm, this statement clearly shows you don't even understand how cryptocurrencies work. It's interesting you feel that you are then qualified to speak on them.

I am an economist and this is my bread and butter! This is where I live. Cryptos are little different than gold, and equally poor as a currency. Study the history of specie, gold and silver, as currency. Once the industrial revolution took off and companies needed to borrow large sums to expand, specie currencies became altogether inadequate.

To promote steady solid economic growth a money supply has to grow, but that growth can't be too small or too large. The amount of money in circulation has a huge effect on the price level. Too much and you have inflation. Too little and you choke off investment and economic growth. A good central bank finds that balance the maximizes growth and employment without creating too much inflation.

With a cryptocurrency as they are practiced today you have none of those qualities. There is no central management of these currencies to maximize economic growth or to prevent inflation. If you look at the sharp rises and falls in the price of Bitcoin, that is anathema to a well run currency. Imagine being a big business and the value of your revenue stream, your debt, and your accumulated cash on hand rose and fell the way the price of Bitcoin or other crypto currencies do. Imagine if the value of the money in your pocket or the value of your personal saving rose and fell like the value of crypto currencies do as a matter of routine. There would be no way to plan financially. Well managed currencies do not have 10% price swings in a single week like Bitcoin does. Here is a chart showing the price swings of Bitcoin to demonstrate my point.

https://www.statista.com/statistics/326707/bitcoin-price-index/

A well managed national currency should have a slow steady appreciation in value, not the wild swings shown in that chart. Crypto currencies have been done before in essence. In the 19th Century in the US, every bank issued its own bank notes, paper money in every sense of the word. But every merchant had their own discount rate for each bank's currency based on their own personal opinion of two things, how much someone else would pay for that note (in another bank's banknote) and how likely the merchant thought the bank would honor their note. Some banks back then before the FDIC didn't honor their own bank notes. The end result was rapid inflation as banks lent money and printed bank notes, followed by a crash and a depression where there was wide spread deflation. And obtw, the US was notionally on a gold standard the whole time. It wasn't until the Great Depression that the Fed and US Treasury took their jobs seriously and began actively managing the nation's money supply, controlling lending and guaranteeing deposits. You have none of that with crypto currencies. They are an investment commodity like gold or silver but not a reliable store of value necessary for an effective currency.

I am an economist and this is my bread and butter! This is where I live.

And I'm in security. Hashing algorithms are my bread and butter. This is where I live.

Cryptos are little different than gold

Gold is a commodity, cryptocurrencies are a currency. They are not equivalent.

To promote steady solid economic growth a money supply has to grown

Where is the requirement of 'promoting steady solid economic growth' in the definition of a currency?

Your complaints about cryptocurrencies seem to be that you just don't like how it's not the same as a FIAT currency. You're right, it's not, and the value of cryptocurrencies is based on different values than FIAT currencies.

Nevertheless, cryptocurrencies ARE currencies. If you feel they aren't, then which definition of a currency do they not fulfill?

A well managed national currency

Well here is your major misunderstanding - decentralized cryptocurrencies are unmanaged. They are entirely market driven. There is no way to manage them - that's the whole purpose of decentralization. That's why the people who somehow think we could somehow get rid of them are deluding themselves. The networks are spread out over multiple nations, trying to shut it down would require the agreement of all governments, and for small nations, it's in their better interest to use cryptocurrencies than FIAT. That's why you're seeing some small nations adapting cryptocurrencies as national currencies.