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Archive for October, 2009

The Currency Debate

I am getting quite confused by the currency manipulation discussion surround the Chinese RMB.  Today, Nobel Laureate Krugman came up with this piece in the NY Times. 

I read it once, twice, thrice.  But I think I am missing his point still.  Here’s where I think his logic lies.  Exchange rate is determined by supply and demand of currencies, which in turn, should be determined by import/export balance (either capital or goods).  It is a mechanism which should, in theory, make massive trade imbalances unsustainable.  In theory, since this assumes free trade between all countries. Since the RMB is pegged against the USD, its value appreciates or depreciates with the USD.   At the moment, the RMB is pegged at a lower rate than what it will be at, if traded freely (that’s the assumption, I have no idea). 

I get all that.  What I don’t quite get is how the peg is considered to be currency manipulation when pumping USD into the marketplace is considered not.  When our Fed fixes interest rate at almost zero, requiring our treasury to issue bonds and purchasing them back…   the result is massive pumping and devaluation of the currency.  Yes, the USD is determined by supply and demand, but when we can create the supply and demand ourselves, how is that not manipulation? 

My simple conclusion here is that we are trying to manipulate our currency, but the Chinese are getting in our way since they have their own manipulation mechanism.

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TAP: The Sweets

I must confess that I have never liked traditional Chinese desserts.  Where is the chocolate?

While americanized chinese restaurants usually distribute oranges and fortune cookies (a US invention) at the end of your greasy meal, the traditional chinese desserts are in the form of a hot pudding or hot sweet soup.  I tend to think of them in two categories.

1) Hot Puddings.  These are made from one core ingredient, e.g. black sesame, red beans, mung beans, walnut, almonds…  and lots of sugar.  The ingredients are grounded then brewed for hours until they dissolve into a thick paste – the result is a condensed flavored hot sweet pudding.  My favorite of this list is the walnut pudding although it’s really difficult to find in the US.  Next favorite is the mung bean (green bean) one.  

BlacksesameSoup.jpg   Redbeansoupdessert.jpg

2) Hot Soups.  These generally have a clear base, with multiple ingredients (herbs, flowers, fruits, fungus and what not) that will either help generate great skin, or provide strength, or prevent aging.  Or a combination of the above.  The taste is generally quite mild and it is somewhat soothing to consume at the end of a big meal.  My favorite is papaya with clear fungus.  It is quite tasty.  I try to avoid anything with either bird’s saliva or frogs ovaries or anything else I do not normally consume… 

 

 Where to get in NYC:  This is not easy to find.  Sweet and Tart used to carry it, although they closed down their Mott Street location a few years back.  Maybe can try checking out their Flushing location.  Otherwise, the best bet is probably XO Kitchen and Bar (Hester street).

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Too complex of a topic to blog about, so…  let’s go to the pictures. 

china

Participants dance with fans during a massive parade to mark the 60th anniversary of the founding of the People's Republic of China

The phalanx of national flag receives inspection in a parade of the celebrations for the 60th anniversary of the founding of the People's Republic of China, on Chang'an Street in central Beijing, capital of China, Oct. 1, 2009. (Xinhua/Yang Lei)

Female members of a Chinese military reserve unit march.  During the two-hour-plus festivities, more than 100 helicopters and jets flew over the city in formation.

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