Phil Levy writes: [O]n currency, the United States. needs to be careful what it asks for. If it wants a sharp appreciation, it won’t get it. China would be in no position to deliver, since $1 trillion proved insufficient to slow the decline. If the U.S. demands that China stop intervening, the Chinese could oblige and let the RMB plunge. In that case, the Trump administration might get what it asks for, but not what it wants. It remains to be seen whether the Trump administration will execute the traditional political pivot toward a more sensible policy. Yet another important Asia call for them to make. – Foreign Policy’s Shadow Government
Dan Blumenthal and Randall Schriver write: It is the height of cynicism to view U.S. relations with Taiwan and China in zero-sum terms. We can have good relations with both sides of the strait. The good news is that the Sino-American relationship has matured and has a solid foundation. Ironically, the people who seem willing to take the Tsai-Trump call in stride are Chinese Communist Party leaders. It appears that China is prepared for the United States to a return to strenuous advocacy on behalf of its interests and values. China will doubtless do the same. The work of diplomacy will be managing our differences, including on Taiwan, in ways that do not lead to conflict. – The National Interest
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Prime Minister Narendra Modi handpicked a trusted bureaucrat, little known outside India's financial circles, to spearhead a radical move to abolish 86 percent of the country's cash overnight and take aim at the huge shadow economy. – Reuters Voice quivering, Prime Minister Narendra Modi on Sunday dramatically countered criticism of his surprise ban on most currency in circulation in India, a bold attack on corruption that crippled business at stores and markets around the country as millions scrambled for cash to meet even basic needs. – New York Times Indian Prime Minister Narendra Modi's shock ban on high-value banknotes will hit the war chests of his rivals before a key state election next year, sparking accusations that his strike against "black cash" will unfairly boost his party's chances. - Reuters
Editorial: Cash is vital to the Indian economy because it allows people to escape the crushing weight of state bureaucracy. Reduced reliance on cash could be a useful indicator that Mr. Modi’s reforms are succeeding. But punishing Indians for their rational preferences will only backfire economically and politically. – Wall Street Journal (subscription required) Jeff Smith writes: With the possible exception of the United States, no country has been as successful as Japan in persuading India to abandon the artificial constraints of nonalignment. And no relationship is likely to prove of greater consequence to the regional and global order that the three countries seek to defend and uphold. From “soft power” to “hard power,” and from the South China Sea to Africa, India and Japan are constructing the framework for a transformative twenty-first-century partnership. – The National Interest ![]()
Egypt liberalized its exchange rate and devalued the currency by almost 50 percent on Thursday to combat its severe economic problems and lay the groundwork for a vital $12 billion loan from the International Monetary Fund. – Washington Post Egypt’s central bank on Thursday said it would soon allow the country’s currency to trade freely, part of a broader effort to save a free-falling economy and combat an increasingly prevalent black market for American dollars. – New York Times
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