Protectionism threatens prosperity - FT.com
Hank Paulson, US treasury secretary, recently released a statement that the global economy currently faces a “disturbing wave of protectionism” that threatens open markets and continued economic development. He expressed his concern about anti-trade rhetoric that he has been exposed to in the US and abroad. This is the former CEO of Goldman Sachs' first major statement as secretary.
He further called on Beijing to revalue its currency and open up to foreign investment – he said that doing so would be of great benefit to both the US and China, as he feels China’s economy is now overheating. He further said that China needs to become less of an export-driven country and rely on domestic consumption – but to do so would require major reform of the country’s capital markets.
Economists have hope that Paulson, who is highly experienced in trading and investment, and did much to improve Goldman Sach’s position, will work his magic with the US economy. The current US account deficit, which exceeds some US$800 billion, requires foreigners to finance by buying more than $2 billion in US-dollar-denominated assets every day – tackling such a problem is a monumental task even for a former Goldman Sachs star. (see Paulson and the dollar - Asia Times)
Paulson, with 30 months remaining in President Bush’s term, pledged to revitalize collapsed Doha trade talks and to continue to further trade negotiations globally. He also hinted that some type of reform for section 404 of the controversial Sarbanes-Oxley law would take place; currently the law is criticized as hampering business in the stock exchange.
Subscribe to:
Post Comments (Atom)
1 comment:
I believe you're right regarding China's trade deficit with other countries; fortunately for them, our deficit with them is so large that it bankrolls their other deficits PLUS allows them to have an overall surplus.
Post a Comment