Law /
Those of us in Sterling GBP are having our backsides kicked [35]
A country can't maintain a strong currency when they outsource their manufacturing overseas. You have to produce something. A weak currency will attract investment. It's how the Chinese did it. They pegged their currency to the dollar.
While I agree with your first statement your overall reasoning is very flawed. A temporarily weakened currency will indeed attract investment. However, a currency that's being continuously devalued created distrust in the business and investment community and leads to inflation which is the "poor man's" worst enemy. Rich people can always find a way to hedge their investments while to poor people pay the brunt of an inflationary policy. Greece would benefit greatly from a devaluation right now, unfortunately they gave up that option when they switched to the Euro. The US on the other hand is double punishing itself each time we print extra money as "cheapening" of the dollar means more expensive commodity prices. Oil, copper, aluminum are all good examples. In order for the sellers to maintain their profit margins the prices on those commodities had to rise to offset the falling dollar.
We tend to blame the Chinese no matter what they do but the truth is that their economy is more capitalistic than most western nations, including the US. Not too long ago we praised China for not devaluing the uan during the Asian crisis when the Thai Bhat, Korean ₩on, Indonesian Rupee went through double digit devaluations. At the time a slow and moderate currency appreciation or depreciation was what the world needed. The US, Canada, most European leaders, Australia all praised China for averting an even larger crises had they chosen to devalue their currency. Fast forward to today and now everyone wants them to make a drastic, rapid revaluation (raising the value) of the uan or RMB. Well, the value is rising but slowly and gradually, just like it did 5, or 10 years ago.
As far as a peg to the dollar, the Chinese uan is NOT pegged to the dollar but rather to a "secret ratio" of several currencies where the dollar and the euro are the largest "ingredients" but many other currencies are part of it too. The Hong Kong dollar IS pegged to the dollar and a few years back (due to the decline of the dollar) the Red Chinese (Peoples Republic of China) uan for the first time ever became stronger than the Blue Chinese (Hong Kong) Dollar. Today for example 1 YS dollar will give you 7.78 Hong Kong dollars but only 6.47 uans.
So in a nutshell a temporary devaluation or weakening of a currency might attract investment but in the long run it actually hinders it. Perfect example were the German Mark and the Italian Lira. No matter how weak the Lira was getting year after year the unemployment in Italy hovered higher than in Germany, if you consider the extra cost of reunification for Germany the performance of the Deutch Mark was basically phenomenal.
80 to the dollar isn't my idea of strong.
Please tell me you're joking? Or do you understand how foreign exchange values are derived? (not trying to sound demeaning toward you but frankly I'm shocked by your statement).
You do realize that countries have chosen different "base" values for their currencies, right? So just because it takes 80 units of one country's currency to buy 1 unit of another country's currency doesn't mean that the first currency is "weaker." In other words you must compare apples to apples. Korea for example adds another zero to the equation so 1 US dollar buys ₩1,065 (south Korean ₩ons) yet the ₩on is very strong against the dollar. Clear as mudd?
en.wikipedia.org/wiki/Tables_of_historical_exchange_rates_to_the_USD