But why should our exchange rate soar long ago? The reason is that China's foreign exchange reserves have increased sharply in recent years, and it is inevitable that the local currency will appreciate when the foreign currency holdings continue to increase. Because of this law, the balance of payments can be balanced. This is the problem. The rules of the game are like this, but the policy of our country is another matter. We don't follow the rules of the game, so there is a solution, that is, spend the money and make ends meet. At present, China has the largest foreign exchange reserves, and the balance of payments has been seriously unbalanced. Everyone who has studied macroeconomics knows that the best mode of economic development is the balance of payments, but the problem is that our country has now made ends meet.
According to traditional ideas, don't you think this is a good thing? Serious living beyond one's means is not a good thing at all, but the consequences are very bad. You may say that this price surge is mainly caused by pigs, but the pork problem is only a fuse, which is basically caused by the serious oversupply in China for many years. Imagine that domestic materials, especially agricultural products, earn foreign exchange through export, and domestic materials are scarce. Can prices not go up? Food is the most important thing for people. When food prices go up, do other things go up?
Is it meaningful to hoard so much foreign exchange? Let's look at this problem in a small place first. If a person only earns money without spending money, then the money he earns can only be paper, which is hidden in the safe at home every day, waiting for mildew. Because he doesn't spend money, the social economy can't develop and the existing value can't appreciate. This person will also be called a miser by others. The same is true of a country. Hoarding foreign exchange is like hoarding this kind of plate accumulation. How to solve this problem? Just two words-spend money! Instead of hoarding paper, it is better to hoard some strategic materials such as oil and turn foreign exchange reserves into energy reserves. Or spend money to buy some foreign technology. I think anything can be done except buying garbage and luxury goods. But if you want to stabilize prices, you must spend money. At present, the central government has issued a policy of restricting exports, which can only be a temporary measure. If we want to solve the problem fundamentally, we must find ways to make good use of these hoarded foreign exchange and make rational use of it, so that China's economy can continue to develop at a high speed and steadily.