Why,are,prices,lower,the,U.S., business, insurance Why are prices lower in the U.S. than in China?
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A finance critic named Han Bing recently went the United States and he met a group of Chinesetourists in Los Angeleswhen they were shopping crazily. In a bag shop almost every person from China bought more than two boxes because they themto hold what they had bought in the U.S. When they were choosing the commodity, theywere surprised to find that they prices were much lower than that in China. It is not surprising that the internationalbrand-name goods, taking into account of levy high tariffs, plus freight andother factors, are expensive than in the West. However, some Chinese-made goodsare actually much more expensive in Chinathan in the U.S.,in fact, this is really ridiculous.There are many factors affecting the price. One unavoidablefactor accounting for the low price in the United States is that for manyyears it has maintained a very low rate of inflation. Cent as the basic unit ofcurrency still circulates in the market. Therefore, the U.S. pricestability is evident. During the 30 years after China adopted reforming and openingup policy, Chinese cent as the basic unit in the RMB has retreated from thecirculation. To a certain extent, this can reflect the speed of price increasein China.The privileged position that the United States enjoyedcan partially account for the above stability. As the international currency,even though the United States has to face some slowdown in thegrowth of economy, in the process of the currency circulation, it can make it possiblethat the other countries may share its loss. China has actually made some contribution.Some scholars believe that root causing such differences inChina and the United Statesis that when the two countries are involved in the process of globalization, thereis the formation of a very pro-American economic relation.China hasconstantly promoted cheap exports to the United States through a variety ofpolicy tools driven by the purposes of solving the employment problem. This hasfully depressed commodity prices in the United States, especially commodityprices. At the same time, Chinahas turned a large sum of dollar that it has earned into various forms ofsecurities assets and reserved them up quietly and stably in the United States.From both the supply and consumption, Chinahas been friendly and helpful enough for inhibiting price increase in the United States.
Why,are,prices,lower,the,U.S.,