One big of data that suggests to me that the US-China trade deficits and foreign exchange acculmlation isn’t unsustainable. The foreign exchange reserves for the PRC is about $1.2 trillion and the trade deficit is about $200 billion/year. This is about the size and revenue of one of the major banks in the United States. The State Financial Investment Corporation that the People’s Bank of China will create next year isn’t a particularly large financial institution by global standards.
July 14, 2007
A Trillion Dollars really isn’t that much money