Chapter 8

From what I understood of this chapter, the Chinese currency (although it has fluctuated over the past ten years) is not too close to being of equal value to United States currency which is why in the U.S. we import so many goods from China, it is very cheap for us to buy their goods and as Dodson stated, America loves a "good deal". China would reinvest overseas Chinese money in U.S. Treasure bonds which the American government uses to finance it's debt. This whole explanation, while extremely complicated, shows me that our two economies, along with the economies of various other countries, are completely entangled. The valuing of the yuan is important in China because they want to keep it at a place where they can continue to be business partners with the U.S. The valuing of the yuan is important to the United States because if the value of the yuan stays low then we can continue to important goods manufactured in China for low costs. Dodson writes that "China has no choice but to further integrate it's economy with that of global commerce, trade, and financial networks". In order to continue to be on a track towards the more western lifestyle it strives for, China must continue its globalization. This chapter also reminded me that the bends and turns our economy takes does not only affect American citizens. Dodson discusses the effect that the Great Recession of 2008-09 had in China, writing that it rattled Chinese leadership "into understanding that it needed some place else to park its dollar reserves.