China rocked stock markets around the world and made business headlines this week after the People’s Bank of China (PBOC) announced it had devalued its yuan by two percent against the dollar for the second time in a couple of days. This will make Chinese goods cheaper, especially at a time when data showed exports in July tumbled 8.3 percent. It’s time to see more Made in China products in our stores and households as a result.
Donald Trump doesn’t think this is a good thing. In fact, he believes China is “destroying” the United States with this monetary policy.
The billionaire real estate mogul and 2016 presidential candidate, who is leading by the way, spoke with CNN on Tuesday and described the devaluation as “devastating.”
“They keep devaluing their currency until they get it right,” said Trump. “They’re doing a big cut in the yuan, and that’s going to be devastating for us.”
Trump has made China the centerpiece of his presidential campaign, or at least it appears this way. The outlandish figure has said he would be a tougher negotiator if he were U.S. president and the Land of the Free would win again.
“We have so much power over China,” he told the news outlet. “China has gotten rich off of us. China has rebuilt itself with the money it’s sucked out of the United States and the jobs that it’s sucked out of the United States.”
Although he looks like he’s a proponent of free market and free trade, he isn’t as he wants to impose protectionist policies and trade agreements that he favors. Trump also doesn’t seem to think about comparative advantage, something that China has plenty of right now in today’s economy.
But hey, his language is working since he is leading Jeb Bush, Marco Rubio, Rand Paul and the rest of the Republican field. At this point, his only real competitor would be Hillary Clinton, who is likely the Democratic nominee and eventual White House occupant. That should be an interesting debate.
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