Japan was not the "bottom" in the race to the bottom. they were undercut by china. who can undercut China? perhaps countries like Vietnam for some tasks, but on the whole, there is no nation with the kind of infinite labor supply that china has. and their labor supply is perfectly crafted to take US jobs - slave labor at the bottom forced to do factory work at the point of a gun or starvation, and a well educated workforce segment to take engineering and techincal jobs.
"Of course, another way to look at it is this: The Chinese are doing exactly what the Japanese did in the 70s and 80s. The world did not come to an end."
It was clever then and it is clever now, for *many* of those involved...and it was painful then and it is painful now to many players.
Likewise, such currency manipulation policies can eventually crumble, ushering in the Mexican Peso crisis or the Argentinian inflation crisis or the Asian currency crisis of 1997 or the Russian default on sovereign debt in 1998, etc.
It's Market Interference, on a grand scale, by governments. Such interference benefits many and costs many others. This should not be applauded.
It should be fixed, and I'm very appreciative of the Bush Administration for the way that they are handling it, and have been handling it for the past 4 years, long before China's clever little trick blows up into something larger.
The Chinese are doing exactly what the Japanese did in the 70s and 80s. The world did not come to an end. Exactly, as I have previously stated and detailed in Post #100 as well as #'s 15,26,33, 67.
Hike!