Chinese Central Bank Buying Treasuries

Curated and Reviewed by Lesson Planet

The first several minutes of this clip are a review of the hypothetical China-U.S. trade scenario Sal mapped out in previous videos. Then, he begins to further outline how the Yuan can resist appreciation because of interference by the Chinese Central Bank and it's desire to peg the current exchange rate. Learners explore the Chinese government's solution of printing Yuan, exchanging for dollars, and investing in a safe, dollar-denominated liquid asset: U.S. treasuries. He leads economists into considering the impact of large-scale loans from the Chinese government on the US economy and debt.

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Concepts

deflation, inflation, interest, the people's bank of china, exchange rate

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Additional Tags

chinese central bank, interest, u.s. treasuries, inflation, deflation, exchange rate, social studies

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Resource Details

Grade

11th - Higher Ed

Subjects

Social Studies & History