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Chinese rioting over high food prices due to artificial rmb value

November 18 2010 at 2:20 PM
WAFFer  (Login news1982)
Eagle Squadron (US)

After announcing steps to curb surging food prices that are stoking public anger, China's leaders face the challenge of curbing simmering inflation pressures throughout the economy without derailing its recovery.

The double-digit jump in food costs that Beijing vowed Wednesday to tamp down is a symptom of widespread, growing price pressures, rather than the cause, analysts say.

They blame a flood of bank lending and say communist leaders need to hike interest rates and tighten credit before price rises in other parts of the economy pick up.

"The government needs to do a lot more than it was prepared to," said Standard Chartered economist Jinny Yan.

Wednesday's announcement highlighted the contrast between China, which recovered quickly from the global recession and is trying to cool inflation, and the United States and other major developed economies, which are trying to shore up growth.

Beijing said it would impose price controls if needed on basic food items, boost vegetable production, give food subsidies to poor families and release stockpiles of grain, cooking oil and sugar. That came after food prices in October jumped 10.1 percent over the year before, pushing inflation to a 25-month high of 4.4 percent.

Food prices are sensitive in a society where families spend up to half their incomes on food and communist leaders see them as a trigger for possible unrest. But the flood of bank lending that supported Beijing's stimulus also fueled real estate and stock speculation that pushed up housing costs at double-digit rates early this year.

At a Beijing market on Thursday, a 64-year-old retiree who would give only her surname, He, said she is coping by eating more low-cost cabbage. She said she has rented a garden plot outside Beijing to raise cucumbers and green vegetables.

"These vegetables are too expensive!" He said, pointing at a table loaded with tomatoes.

The latest government measures, full details of which are yet to be released, "will unlikely be effective in solving the underlying inflation problem," according to Goldman Sachs economists Yu Song and Helen Qiao.

"The rise in prices ... are the results, instead of the causes, of higher inflationary pressures induced by an overly loose policy," Yu and Qiao said in a report.

Until now, Beijing has used targeted tools to control prices of housing and other items while avoiding large across-the-board interest rate rises. Rate hikes are politically fraught because they would raise costs for state companies and heavily indebted local government investment agencies.

Wednesday's announcement made no mention of tighter credit, and Goldman's Yu and Qiao suggested that might be because such a step is so sensitive that it requires approval from senior leaders who were traveling abroad and unavailable.

Another potential anti-inflation tool is even more politically volatile allowing a faster rise in China's tightly controlled currency, the yuan, which would cut import costs. Beijing has allowed the yuan to gain about 3 percent against the dollar since June but has resisted pressure from Washington and others for a faster rise, which would hurt China's exporters and might cost jobs.

Private sector economists say Beijing might hike interest rates again this year following its Oct. 19 increase, its first since the crisis, and try to rein in credit by ordering banks to hold back more money as reserves.

That possibility has rattled Chinese stock markets, which fell this week on fears that tighter economic controls will further slow growth that declined to 9.6 percent in the three months through September, from 10.3 percent the previous quarter.

A sharper slowdown could hurt the global recovery by cutting into Chinese demand for iron ore, factory machinery and other imports from the United States, Europe and other economies.

Still, said Yan, "what could be more of a risk is inflation getting out of control. So in this sort of situation, we would imagine tightening is still the best thing to do."

A report by a government think tank this month suggested inflation might be even higher than reported because data fail to fully account for costs of services and housing.

China faced a surge in food costs in 2008 due to shortages of pork, a staple of the Chinese diet, which triggered price controls and quickly subsided. This year's price rises are spread across a wider range of goods.

Worldwide, prices of major food crops are up sharply from last year and further spikes are likely unless production rises, the U.N. Food and Agriculture Organization said Wednesday.

"It's overall inflation in a lot of categories of food. So how is the government going to work against that?" Yan said. "You can't stop prices from rising, especially given the global backdrop."

Another shopper at the Beijing market, Wang Haibin, said his family's grocery bill has risen by about 30 percent over the past year.

"We used to eat in restaurants whenever we liked," said Wang, a manager at a trading company, as he and his wife carefully picked out an eggplant. "But now we must choose to stay at home and cook more, because eating out costs a lot."

http://news.yahoo.com/s/ap/20101118/ap_on_bi_ge/as_china_inflation;_ylt=AnfazixdlQ01P2Vu_czQAC0Bxg8F;_ylu=

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Hawkssss
(Login Hawkssss)
Elite WAFF Vet Club

Re: Chinese rioting over high food prices due to artificial rmb value

November 19 2010, 5:24 AM 

Don't you China haters dream to that happen every day? lolo1lo1l11ol

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WAFFer
(Login ssssshhhh...)
Satyameva Jayate (India)

Re: Chinese rioting over high food prices due to artificial rmb value

November 19 2010, 1:26 PM 

just imagine the possibilities when chinese will achieve their potential in full [linked image]

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Hawkssss
(Login Hawkssss)
Elite WAFF Vet Club

Re: Chinese rioting over high food prices due to artificial rmb value

November 19 2010, 3:50 PM 

them jealous indians....lol Why don't you look at what kind of inflation your shiiit hole of a country is experiencing.....

them stupid indians....l1o1l1

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WAFFer
(Login ssssshhhh...)
Satyameva Jayate (India)

Re: Chinese rioting over high food prices due to artificial rmb value

November 19 2010, 5:51 PM 

them jealous indians...

of course . we are jealous of chingpings rioting over food [linked image]

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WAFFer
(Login news1982)
Eagle Squadron (US)

Re: Chinese rioting over high food prices due to artificial rmb value

November 19 2010, 7:11 PM 

"them jealous indians....lol Why don't you look at what kind of inflation your shiiit hole of a country is experiencing....."

You yourself are a living example of how much China sucks. Your family hated China so they abandoned it and then had you years later. You made no friends growing up and women found you unnatractive, so you dream up China as some great accepting place for you, but you are too scared to go there because you know that dream will be crushed once you witness reality and all the Chinese reject you even more.

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Hawkssss
(Login Hawkssss)
Elite WAFF Vet Club

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 2:51 AM 

Stupid ****, some of my family moved to the States not because they hated China....Just like the original immigrants from Europe to the new world. It wasn't because they hated their homelands, rather they were seeking a better life.....Of course, what can one expect from a stupid american...lol

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WAFFer
(Login ssssshhhh...)
Satyameva Jayate (India)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 6:33 AM 

rather they were seeking a better life.....

ok .. but now that China is the unofficial superpower ( with most powerful computer, higher consumption of High end cars, fastest growing economy which will exceed USA at any moment) they should move back to china. [linked image]

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the name is Broad wink.gif

 
 
WAFFer
(Login politicalgain)
The Redcoats (UK)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 11:35 AM 

Who wouldn't want to live with white people if they got the chance? xD

 
 
hbogyt
(Login hbogyt)
Middle Kingdom (China)

re

November 20 2010, 12:39 PM 

Raising the exchange rate does next to nothing to domestic food prices. Another gimmick to make Chinese leaders look dumb and corrupt and appreciating Yuan like a win-win soltution. Many Americans will believe this.

 
 
Hawkssss
(Login Hawkssss)
Elite WAFF Vet Club

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 12:51 PM 

stupid indians, who said China is the superpower??? Chinese's gdp per capita is 1/10 of the US and we have a long way to go....You see we chinese knows where we stand, unlike you feel-good indians...

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WAFFer
(Login news1982)
Eagle Squadron (US)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 3:25 PM 

"stupid indians, who said China is the superpower??? Chinese's gdp per capita is 1/10 of the US and we have a long way to go....You see we chinese knows where we stand, unlike you feel-good indians..."

There is no 'we' since you are not Chinese. To Chinese you are just another insecure weirdo westerner wishing to be Chinese. You are on the same level as those weirdos who worship anime and want to be Japanese. That is why I can get Chinese women easily while you are stuck with your little fantasies and asian massage parlors.

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WAFFer
(Login news1982)
Eagle Squadron (US)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 3:26 PM 

Food prices would drop if the RMB was at its real value. Since it is artificially lower, people have to pay more. I don't blame China, it is easier to screw the Chinese people while the government gets rich off there backs and sends cash to there Swiss bank accounts.

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Hawkssss
(Login Hawkssss)
Elite WAFF Vet Club

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 4:00 PM 

dude, you sound like you have just been raped by a chinese....get some help....lol

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WAFFer
(Login ssssshhhh...)
Satyameva Jayate (India)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 5:33 PM 

who said China is the superpower??

come on dude: u know , we know that china is superpower.( ask Nicholas, panda, dragon any one ). don't punish Ur self just because of a fcking riot over fcking increase in food price. what if some guys are not able to buy food, u are superpower nevertheless .

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Ever seen an English puppy with tail b/w legs happy.gif

the name is Broad wink.gif

 
 
WAFFer
(Login oneman28)
WAFFer

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 6:55 PM 



Food prices would drop if the RMB was at its real value.


What a nonsense. China's food is basically self-sufficient. We produce 540 million tons of grains a year for 1.3 billion people, that's huge comparing starving India that only produced 220 million tons for 1.2 billion people.

About of 50% of Chinese are living in rural areas. Every farmer has faming land for free unless the farmer gives up the rights. Farmers are not hurt by the inflation, actually they are winners since their products are now sold at higher price.

The real trouble in food prices are mainly vegetables' prices. The cause of is the fast urbanizatoin. Many of the farming land for vegetables are developed. The farmers in the suburbs don't care farming too much as all are expecting selling their usage rights of the farming land for big money (Even the rights were gievn to them for free).

But with the high price, other farmers will plant more vegetables, and the price will be stablized.

BTW, where is the riots for the food price? The author cannot find one.

 
 
WAFFer
(Login news1982)
Eagle Squadron (US)

Re: Chinese rioting over high food prices due to artificial rmb value

November 20 2010, 9:13 PM 

"dude, you sound like you have just been raped by a chinese....get some help....lol"

The Chinese ladies can rape me all they want, I'm not complaining wink.gif

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WAFFer
(Login zergcerebrates)
Middle Kingdom (China)

Re: Chinese rioting over high food prices due to artificial rmb value

November 21 2010, 11:29 PM 


Its just food rioting OMG! Whats the big fuss? You guys do know this is not an actual riot right but rather unsatisfied citizens complainging about food prices. This inflation thing can be solve very fast in China, thats the good thing of this CCP government.

 
 
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