IMO, the current economic woes across the world is mainly caused massive devaluation of U.S. dollar. U.S. government needs to cut back on the deficit and stop printing money. Not much China can do.
Expectations low for US-China economic talks
WASHINGTON (AP) — A global credit crisis and record oil prices will be competing with traditional trade and currency issues when top officials from the United States and China gather in Annapolis, Md., later this month.
However, there is little expectation the fourth round of these high-level discussions will produce any major breakthroughs....
Oil prices took their biggest single-day leap ever on Friday, jumping by nearly $11 to $138.54 per barrel, an increase that helped drag down the Dow Jones industrial average by nearly 400 points as investors grew more worried about the fate of the U.S. economy.
Those fears were heightened by a report earlier in the day that the U.S. unemployment rate jumped one-half percentage point in May to 5.5 percent, the biggest increase in 22 years.
The administration would like to ease worries about employment in the United States by getting China to allow its currency, the yuan, to rise more quickly in value against the dollar. U.S. manufacturers contend that the Chinese have gained unfair trade advantages by keeping the yuan undervalued, making Chinese goods cheaper for American consumers and American products more expensive in China.
The yuan has risen almost 20 percent against the dollar since the Chinese revamped their currency system in July 2005. Critics say that is less than half of the distance it needs to go to erase an unfair trade advantage they contend has contributed to the loss of more than 3 million U.S. manufacturing jobs since 2001....