The more valuable the exchange rate, the better the national economy? Is this a cognitive pursuit of the simple mistake of RMB +0: 1 against the US dollar? In fact, the specific value of exchange rate is meaningless at all.
You can imagine if we decide to implement a new set of RMB now, stipulating that the old RMB 10 = the new RMB 1, the old RMB 100 = the new RMB 10, and so on. All will be denominated in the new version of RMB, and the bank figures will be revised overnight.
Accordingly, once issued, the RMB exchange rate will immediately increase by 10 times, and the newly added RMB is equivalent to 0.7: 1 against the US dollar. But may I ask, has China's economy changed since the new RMB was issued? Obviously not. In other words, it is easy to raise the exchange rate by 10, 100 or even 1000, but it is worthless.
For example, let's look at other currencies: NTD: USD = 30:1; Yen: USD =108:1; Won: USD = 1200: 1 etc. In fact, the per capita GDP of these places is currently higher than that of Chinese mainland. Visible, high exchange rate = good economy, low exchange rate = poor economy? The economy of a place like Korea must be terrible, right? Obviously not. So it is meaningless to pursue the perfect exchange rate of 1: 1. On the other hand, if we can see that China's GDP per capita catches up with that of the United States, the comparison will be much more useful. Can I change it to: RMB exchange rate can be increased by 7 times to 1: 1 at present? In fact, there is no need to ponder. In the contemporary world, the exchange rate of loan currency has never risen seven times. This is really a human factor that has created an indoor space for hedging and arbitrage. It should be understood that stabilizing exchange rates is the work plan of central banks around the world, not appreciation.
On the other hand, it is more likely to find out whether the dollar will fall to 1/7 on purpose today. After all, the debt of the United States is already very large, and the loan interest has not even risen. Is it possible not to owe money by taking the falling dollar as the only development direction?
What if the real exchange rate between RMB and USD becomes 1: 1? The first major danger is the loss of assets. Why? Due to the appreciation of RMB, losses can be exchanged for more dollars, making money as easy as blowing off dust. For example, if an investor now has RMB 6,543.8+million in China, and the RMB appreciates to 654.38+0 to 654.38+0, then his RMB 6,543.8+million becomes USD 6,543.8+million, and he doesn't flee the USD immediately? I left to invest in Vietnam projects.
The second is that foreign capital is not easy to enter. In fact, the harm of RMB appreciation to economic development has flashed. At this time, the cost of foreign-funded enterprises increased, and foreign investment became less and less. Foreign-funded enterprises left in succession and went to Southeast Asia, such as Vietnam. This is the key reason why Vietnam's economy has developed well and its stock market is booming for so many years.
The third is that there are fewer and fewer exports. Changing the exchange rate to 1: 1 will eventually lead to the decline of China's economic development. Because the goods to be exported cannot be sold, it will immediately damage exports, while the processing and manufacturing industries related to exports will go bankrupt, workers will be laid off, and the number of unemployed people will rise, which will damage all fields. It can be seen that the RMB against the US dollar 1: 1 is obviously not a good thing!
RMB appreciation is like a double-edged sword, which has both advantages and disadvantages. If the RMB appreciates sharply, the disadvantages are obvious, but the pursuit of perfect RMB exchange rate stability is the most important thing. If the RMB can appreciate properly, there are many benefits:
First, it can expand the requirements of China customers for imported goods, so that they can obtain a large number of products with high cost performance.
Second, it can alleviate the cost pressure of imported electric energy and raw materials. In China, where resources are scarce, and the international prices of electric energy and raw materials continue to rise, China Company is bound to bear heavier cost pressure.
Third, it is conducive to promoting the adjustment of the industrial structure of China's industrial chain. A moderate appreciation of RMB is conducive to promoting export enterprises to enhance their technical strength and commodity level, thus promoting the adjustment of industrial structure of China's industrial chain and improving their influence in social division of labor.
Fourth, it is conducive to easing the relationship between China and key trading countries. In recent years, the countervailing cases in China have been greatly improved, which is a very infectious direct evidence. A moderate appreciation of RMB will not only help to ease relations with major trading countries and reduce foreign economic and trade disputes, but also help to shape China's outstanding international status as a powerful country. This shows that there must be a balance between the rise and fall of the RMB, and maintaining stability is the best way.
Disadvantages: the world's lending currency is stable, and the products charged in RMB suddenly appreciate, which is followed by inflation and huge bubble destruction. For example, BMW cars imported at100000 dollars can still be bought at100000 dollars. Under such technical circumstances, domestic cars go bankrupt every minute. Because the cost of domestic cars is at home, there is no price advantage and the technology is not high.
Another example: Your house is 6.75 million RMB and sold to Americans for 675,000 USD. You may not buy it because the total market value is valid. Suddenly your house can be sold for $6.75 million, so there is no doubt that you will sell it at the first time, and everyone will sell it. As a result, a large amount of property, with falling prices, will become waste. In China, we have been relying on a large number of exports to promote China's economic development, export our goods and gain a price advantage. All of a sudden, we sold products worth $654.38 million, and now we sell products worth $675,000. The export industry chain collapsed immediately.
Everyone knows that our country has a huge dollar debt. The bonds originally bought at 67.5 yuan were now sold at 10 yuan, causing losses, and China's economy immediately shook. China's RMB real estate was sold by many people because of the skyrocketing and huge bubble. Internationally, products denominated in RMB will also be sold in many TXs, and loans from other countries will be obtained for emergency hedging.
China is getting stronger and stronger, and RMB is circulating more and more internationally. All of a sudden, RMB basically runs counter to the use value price, and no one is afraid to own RMB. With the rapid return of RMB in offshore account, domestic inflationary pressure is even greater. The example of Zimbabwe is gradually emerging.