In the article "U.S. Urges Chinese to save less, buy more" authors Neil King Jr. and James T. Areddy use several facts relevant to macroeconomics to present U.S. Treasury Secretary John Snow and his strategy of encouraging Chinese domestic consumption as a solution to the problem of the United State's growing trade deficit with China. One fact mentioned is that spending by Chinese consumers is extremely low compared to other countries. Its domestic savings ratewhen household, corporate and other deposits are includedis at around 50% which is the highest of any national economy. The savings rate, also known as the Marginal Propensity to Save (defined as a change in saving induced by a change in income), is an important macroeconomics topic. Another fact presented is that China is on pace to rack up a trade surplus with the U.S. of over $200 billion, up from $162 billion in 2004. Also, on October 13, 2005 the Commerce Department announced that the gap in trade with China grew......
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Approximate Word Count: 1695
Approximate Pages: 7 (260 words per double-spaced page) |