Saturday, March 5, 2011

Wen's inflation angst

Fighting inflation is China’s top economic priority this year as the government aims to limit the risk of social unrest, Premier Wen Jiabao said in his state-of- the-nation speech.
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Comment: Don't believe him. Wen is right that inflation will provoke social unrest. Yet fighting inflation will also cause social unrest. Thus the authorities will just wait as they have in the past and the longer they wait the harder it gets to rein in inflation - it is the same in China as in the rest of the world.

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