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Tuesday, April 12, 2005

Is it a big problem about the deficit between US and China?

Why do we can get cheap goods from Walmart? Because most of them are made in China and Chinese products are extremely cheap!

And so there is a huge trade deficit between US and China. Actually, the Chinese did not earn a lot of money.

I have a friend, who was a provincial representative of foreign business in Mideast. He told me he can only earn a cent from each pair of pant, so it is in US.

Another friend of mine owns a small trade company in DC. He sells toys. I saw him sell his goods at the price below their values because he has too many storage and has to do so, otherwise he would lose more money to pay for the storage and the interests to the banks.

US companies can not produce such products like such a way to satisfy the US market. Revalue the RENMINBI is not likely a good way. So the way should be that US sell more and more high-tech products to China to balance the deficit.