Tuesday, October 27, 2009

Paul Krugman on the Yuan/Renminbi Dilemma

Krugman's blog is one of the best in the business.
How does he find the time?
What’s in a name?

Since I wrote about China’s currency in today’s column, I had to confront the issue of what to call the darn thing. In fact, I sometimes think that the whole renminbi/yuan issue is a sinister plot by the Chinese designed specifically to deter people from discussing Chinese currency policy. (Note to literalist readers: that’s a joke).
So: renminbi is the name of China’s currency; but yuan is the denomination of bills, the unit in which prices are measured, etc.. The closest parallel I can think of is Britain’s currency, which is sterling, but whose unit is the pound.
In the case of Britain, however, everyone is easy on talking about the pound’s value, the pound’s exchange rate, and so on; if you talk about sterling’s value, most non-Britons will have no idea what you’re talking about. But for whatever reason, using yuan in the same way draws disapproval.
But here’s the thing: talking about the number of renminbi per dollar is also, as I understand it, wrong — as wrong as talking about the number of sterling per dollar. Renminbi is the currency, but not a unit of the currency.
The Times stylebook recommends … evasion — try to avoid using either term, and just talk about “Chinese currency”. I get the motivation, but you end up going through a lot of circumlocutions and eating up crucial page space.
So I did what I could …

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