Berneke: Asians Spend More Plz

When it comes down to the bottom line, a huge role in the disaster that is the US economy comes from trade imbalance. Asian countries, especially China, are exporting to the US more than they are consuming by the US therefore killing our local manufacturing sector while increasing our national debt thanks to the horrifically low average savings rate of the US citizen - less than 5 percent of income according to the Bureau of Economic Analysis (link).

Another strong issue of contention that was skirted by the Fed Cheif during today's talk was the US dollar and the RMB's value compared to it, which is widely believed to be severely undervalued thanks to its government-determined pegging rate to the USD. The government imposed exchange rate is bound to explode resulting in the exploding value of the RMB compared to the dollar.