A Chinese Revaluation May Not Help U.S.

NYTimes January 14, 2005

Basic arguments :

1. The US imports a lot more than it exports to China. The costs of many US companies might actually go up
   
2. Some Chinese companies will actually become more competitive, for example those who buy compnents from US
3. The costs in China are so low that a small revaluation might not effect a big change. Not only the cheap labour, China has superior technology to build things cheaply
4. US and Chinese companies in most cases do compete directly for the same products
5. Even if China becomes unattractive, production would just move some other country closer to the US like Mexico
6. The revaluation should be atleast 25% to have a significant effect. But it is unlikely that Beijing would let it increase beyond 10%