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Trade and Foreign Exchange


Big Mac Index (11/2/2011)

The prices of Big Mac across countries could give an idea of the relative value of foreign currencies.

Keywords: Big Mac, foreign exchange, index, purchasing power parity, real exchange rate

Big Mac Index (transcript) (11/18/2010)

The big mac index provides an interesting perspective into the determination of foreign exchange rates.

Keywords: big mac index, foreign exchange rate, over valuation, PPP, purchasing power parity, real exchange rate, under valuation

Border Patrol (2/27/2007)

To enhance profit, businesses often sell non-interoperable versions of the same products in different markets.

Keywords: DVD, movie, Palm Zaire, price discrimination, printer, product cycle, region code, region locks

Byrding for Profit (6/25/2004)

U. S. shrimpers use anti-dumping protection to resist competitive pressure from more efficient Asian shrimp farmers and to gain de facto subsidy.

Keywords: anti-dumping, Asia, Byrd amendment, overproduction, protection, shrimp, subsidy, tariff

Dividing the Pie (5/13/2010)

Over-extended American consumers provided the ultimate market for consumer goods exported from low-wage countries that are willing to sell on credit.

Keywords: cheap labor, credit, economic pie, globalization, imbalance, profit share, Reserve currency, saving rate, trade deficit, wage share

Domestic Content (5/13/2010)

Economic stimulus might end up stimulating foreign economies more than the domestic economy when the US is so dependent on imports.

Keywords: bullet train, Buy American, credit crunch, domestic content, expenditure multiplier, fiscal policy, recession, Stimulus, wind farm

Easy Money Is Anything but Easy (2/22/2012)

Easy money has unintended consequences.

Keywords: asset bubble, capital flows, expectation, floating exchange rate, monetary policy

Farming the Wind (1/23/2010)

China is tapping US economic stimulus fund to build wind farms in the US.

Keywords: China, green jobs, stimulus package, trade deficit, trade surplus, wind farms, wind turbines

Free Money? (5/12/2010)

The dollar as an international reserve currency allows the United States to pile up huge budget and trade deficits as export-surplus countries accumulate dollars for their foreign exchange reserves.

Keywords: appreciation, budget deficits, central banks, dollar, foreign exchange reserves, free money, IOU, Reserve currency, trade deficits, yuan

Gray Market (11/5/1999)

Gray markets appear when cheaper goods in one market are diverted to compete with more expensive but similar goods in another market.

Keywords: cigarettes., distributors, diversion, diverters, gray market, high-end market, low-end market, parallel imports, price discrimination

Hedging Inflation with Prostitution (1/30/2015)

Prostitution has proven to be an effective hedge against high inflation induced by subsidies and price control in Venezuela.

Keywords: Bolivar, currency trader, devaluation, dollar, exchange rate, inflation, inflation hedge, price control, prostitutes, Smuggling, subsidized gas, Venezuela

Hong Kong Housing Boom (1/21/2010)

The low interest rates intended to stimulate the recessed US economy after the US housing bust in 2007 – 2009 have inadvertently led to a housing boom in Hong Kong when Hong Kong has to lower its interest rates to defend its dollar peg.

Keywords: apartment, dollar peg, foreign exchange, housing boom, housing bust, inflation, mortgage, real interest rates

Hot Money (2/22/2012)

Speculative capital inflows have wreaked havoc in the destination economies.

Keywords: capital flows, contagion, euro crisis, exchange rate, hot money, market intervention, money economy, price ceiling, quantitative easing, real economy, Swiss franc, trade balance

Is China on a 'Gold Standard'? (2/24/2012)

Domestic inflation in China as well as yuan appreciation have boosted the prices of Chinese imports to the US.

Keywords: budget deficit, currency appreciation, exchange rate, gold standard, inflation, trade deficit, trade surplus, yuan value

Less than Meets the Eye (1/22/2010)

China’s apparent heavy dependence on exports for its GDP growth conceals the low value-added contents of its exports.

Keywords: China, export, Germany, labor productivity, value added

Moving Up by Staying Put (8/30/2001)

American companies are increasingly outsourcing back-office and software design work to highly skilled but lower-cost English-speaking foreign workers.

Keywords: back office, foreign workers, globalization, H1-B visa, high- tech industry, immigrants, jobs, labor mobility, migration, outsourcing, salary, skilled workers, wage

No Chicken Feet! (3/28/2013)

Chicken feet, long considered a waste product in the US, have become a profit center for the high-volume low-profit US chicken industry in the China export market. But the export trade is not exempted from political whims.

Keywords:

No Chicken Feet! (1/3/2013)

Chicken feet, long considered a waste product in the US, have become a profit center for the high-volume low-profit US chicken industry in the China export market. But this export trade is not exempted from political whims.

Keywords: byproduct, chicken feet, China, comparative advantage, culture, export, fixed cost, inferior good, tariff, trade protection, US

Sinking Dollar (1/21/2010)

The US dollar has been losing its value as an international reserve currency due to its persistent trade deficits.

Keywords: foreign exchange, Gisele Bundchen, reserve currency, trade deficit, US dollar, yuan

Sugar Daddy (6/22/2006)

US subsidies to domestic sugar cane and sugar beet growers have resulted in huge collateral damage to domestic industries and overseas producers.

Keywords: candy, import quota, price support, subsidies, sugar, sugar beet, sugar cane

The Flipper Factor (6/29/1999)

Can free trade and environmental concern coexist?

Keywords: dolphins, environment, flipper, free trade, GATT, yellow fin tuna

To Revalue or Not to Revalue – The Yuan Story (1/23/2010)

The Chinese yuan may be under-valued against the US dollar, but yuan revaluation is unlikely to substantially reduce US trade deficit with China.

Keywords: current account deficit, current account surplus, dollar, foreign exchange, revaluation, RMB, trade deficit, trade surplus, yuan

Too Global To Be National? (6/18/2010)

US multinationals fatten their bottom lines by arbitraging wages, taxes, and regulations across countries.

Keywords: arbitrage, capital, intellectual property, profit, regulation, taxes, wages

Trade Deficits (11/2/2011)

Trade deficits serve to fill domestic private saving gap and government budget gap.

Keywords: budget gap, net export, saving gap, trade deficits

Trade Deficits (transcript) (11/18/2010)

Trade deficits fund budget deficits and excessive consumption.

Keywords: budget deficit, budget gap, budget surplus, GDP, net exports, NX, saving-investment gap, taxes, trade deficit

Trade Surplus Trap (6/18/2010)

Countries heavily dependent on exporting manufactured goods must deny their own citizens higher standard of living to maintain their trade surplus in an era of global wage arbitrage.

Keywords: China, dollar, exchange rate, fiat money, Germany, Japan, outsourcing, part-time workers, sterilize, temporary workers, trade surplus, Wage arbitrage, wages, yuan

Your Technology or Your Market Access (2/8/2007)

In a buyer's market with many potential sellers, China exacts technology transfers as a condition of entry into its lucrative mass market.

Keywords: Airbus, Boeing, buyer's market, chip fabrication, efficiency, licensing, market access, Motorola, offsets, seller's market, technology transfer, trade distorting