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Comment by mensetmanusman | Hacker News Reader

The peg is a subsidy for the world. I.e. those working under that currency regime should be making more money and have higher purchasing power.

If the population was educated enough to know they were being stolen from, ‘Office Space’-style, they would throw their leaders out.

This is one reason the great firewall of China is so important, and I expect Russia to embrace that umbrella soon.

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May be but what additional things are chinese going to buy from outside their country even if the yuan is higher. Almost every single thing is manufactured/produced inside their own country. The only things they need from outside are raw materials, energy and food (I'm ignoring semiconductor industry for a moment which they already consider as their own little island)

Maybe if the peg was not set, then those working under that currency regime would be "not working".

I don't think the Chinese are subsidizing the world for no reason; and I don't think they are the smartest person in the room either.

That's only going to matter if they are buying outside stuff (like Oil). It does not matter to domestic market.

> If the population was educated enough to know they were being stolen from...

This is basically the same argument used by cryptobros and libertarians to criticize inflation.

I think there are pretty obvious tradeoffs with letting your currency amass purchasing power: probably it would shrink the amount of exports (which means that a lot of people might find themselves without a job) and it would make it harder to get a mortgage.

How do you propose that these negative effects would be mitigated?

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