Comments on: The China syndrome on exchange rates http://www.eastasiaforum.org/2010/02/09/the-china-syndrome-on-exchange-rates/ Economics, Politics and Public Policy in East Asia and the Pacific Sun, 12 Feb 2012 22:50:38 +0000 hourly 1 http://wordpress.org/?v=3.2 By: Lincoln Funghttp://www.eastasiaforum.org/2010/02/09/the-china-syndrome-on-exchange-rates/comment-page-1/#comment-96800 Lincoln Fung Fri, 12 Feb 2010 04:10:39 +0000 http://www.eastasiaforum.org/?p=9821#comment-96800 Mohamed Ariff claims that “There is near-consensus that the current global economic illness is primarily due to deep-seated global imbalances between production and consumption, savings and investment, and imports and exports of goods and services.” One has to ask some questions, like: how was such a “near-consensus”, if there was any, reached? I am afraid to say that I really do not understand the "near consensus", causation relationship between them. Would the author be kind enough to elaborate on that please? I have thought imbalances are a normal part of life, just as savings and borrowings. I think that is how people have developed economic theories of inter-temporal choices based on the life-cycle income hypothesis. For example, developed by Modidliani, a winner of Nobel Prize in economics in 1985. Mohamed Ariff claims that “There is near-consensus that the current global economic illness is primarily due to deep-seated global imbalances between production and consumption, savings and investment, and imports and exports of goods and services.”

One has to ask some questions, like: how was such a “near-consensus”, if there was any, reached?

I am afraid to say that I really do not understand the “near consensus”, causation relationship between them. Would the author be kind enough to elaborate on that please?

I have thought imbalances are a normal part of life, just as savings and borrowings. I think that is how people have developed economic theories of inter-temporal choices based on the life-cycle income hypothesis. For example, developed by Modidliani, a winner of Nobel Prize in economics in 1985.

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