Thursday, April 23, 2009

If China continues its development, there’s slim chance Obama can control us

ZEE BUSINESS BEST B SCHOOL SURVEY

Obama, you would not be able to influence us...

However, while the former Secretary of the Treasury has asked Beijing not to devalue the RMB, Obama’s administration has remained rather silent on the issue. In fact, Obama’s handpicked Timothy L. Geithner somehow favours a more “disciplined and conservative fiscal policy” that may reduce capital flow and the exchange rate.

The devaluation of the US dollar will definitely affect the prospects of the treasury bonds held by different Chinese banks and corporations. The collapse of the US domestic market will further hurt China’s vast export interests and direct investment in the States. Putting aside the economic figures, this also means a reduction in Washington’s ability to impose economic pressure on Beijing.

On the security front, one of the features of the Bush administration is its unilateral action in foreign policy. As Joseph Nye has stated, Bush’s office has nearly destroyed all the American soft-power capacity established since the Cold War. As a consequence, Obama’s administration has put “Renewing American Global Leadership” as of the utmost importance.


For more articles, Click on IIPM Article.
Source :
IIPM Editorial, 2008
An Initiative of IIPM, Malay Chaudhuri and
Arindam Chaudhuri (Renowned Management Guru and Economist).


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