China appears to be getting serious about diversifying its forex reserves. There is increasing preference amongst the Chinese authorities for JGB (Japanese Government Bonds), Euro-zone Bonds, and now South Korean Bonds. If the Chinese shift (away from US treasuries) is part of a secular long-term strategy, it might have repercussions for US fiscal policymakers down the road (especially in a year or two when ‘flight to safety’ is no longer the primary driver of investment strategies)
Germany gets criticized for being successful
http://www.bloomberg.com/news/2010-08-17/germany-ignores-soros-as-exports-drive-record-growth-at-consumers-expense.html
http://www.bloomberg.com/news/2010-08-17/germany-ignores-soros-as-exports-drive-record-growth-at-consumers-expense.html
As even some economists appear to be forgetting the basics of international trade these days, it is refreshing to see Prof. Bhagwati offer some much needed straight talk on free trade: