Donald Trump warns that China’s handling of the current financial crisis could lead to an economic depression.
Appearing on Fox News with Bill O’Reilly, the Republican presidential frontrunner explained why the Chinese were deliberately devaluing the yuan.
“They’re cheapening their currency and making it very inexpensive. They’ll be able to make goods for far less than our goods. We make great product but it’s impossible to compete when the product is so much more expensive. But what they’re doing, Bill, leads to depression eventually,” said Trump.
“Markets are crashing – all caused by poor planning and allowing China and Asia to dictate the agenda. This could get very messy!” Trump tweeted yesterday.
Markets are crashing – all caused by poor planning and allowing China and Asia to dictate the agenda. This could get very messy! Vote Trump.
— Donald J. Trump (@realDonaldTrump) August 24, 2015
Beijing moved to further devalue the yuan earlier today with the Bank of China making its fifth interest rate cut in nine months.
“The benchmark rate for a one-year loan will be cut by 0.25 percentage point to 4.6 per cent and the one-year rate for deposits will fall by a similar margin to 1.75 per cent,” reports the South China Morning Post.
Asian markets crashed again on Tuesday, with the key Shanghai Composite Index plummeting another 7.63% and Tokyo’s Nikkei index closing 4% down.
Meanwhile, the Communist Chinese government has been busy attempting to censor news of the financial collapse.
“Baidu, the country’s biggest search engine, is censoring results related to the chaos, according to George Chen, managing editor of the international edition of the South China Morning Post,” reports the Independent. “When searching for the Chinese characters that translate to stock disaster, the results say that “Due to related rules & policy, some search results won’t be shown”.
Major Chinese news outlets are also burying stories about the financial meltdown further down their web pages despite the issue being a top story all over the world.
As Peter Schiff and others have pointed out, while the Chinese meltdown is partly responsible for current jitters, the “correction” in the US stock market has more to do with a seven year program of Federal Reserve quantitative easing coming to an end.
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