BIG NEWS! China revalues the yuan (barely)

Curious. I too think that any revaluation is pretty much a joke (and agree whole-heartedly with Bliss' earlier article on the whole US-China situation) as the conversion rate is entirely one-way, meaning that China just made itself more expensive for investment and travel. But if you're paid in dollars it's pretty much a non-starter anyway, right Ryan? I used to be paid in USD but am now on the RMB end, and also wish I knew more about how to get usable currency out of the country. Not because I want to get rich, but because I don't want to be broke!

TRading money with friends and black markets are not my ideas of fun ways to convert RMB to USD. It's still Disneyland dollars. I will stick to getting my salary in USD.

Ryan,

I was just thinking about that--would need to do more research into the detailed requirements, but an article is a possibility. There are a few routes to take, the easiest being simply to find a friend that does get paid in USD, and make a straight RMB trade with them and save them a trip to the bank or the ATM. That's what I did on my most recent trip back to the States, because I was previously with a company that paid solely in RMB. I had started to look into the official method, going through the Bank of China: this can be done with certain required letters from your employer (red stamped, of course). I gave up before finding out detailed requirements because of course, doing anything officially means a lot of paperwork and red tape. There's also always the blackmarket route--of course, you'll lose some of the value off the top through this method.

Hi Bliss,

Really, tell me how to convert RMB to USD, in fact maybe make an article out of it, I think a lot of us don't know how to do that.

Ryan

Ryan,

I always get my RMB converted to dollars before I go back to the US. You should look into doing that.

Hi Bliss,

I don't buy your arguement that if I get all my pay in RMB and the rate charnges transtically in favor of the RMB, I will be "rich". If I go back home with a bricks of RMB, which bank can I walk into to convert the money to USD? None. Its not a convertable currency, it is intended to stay in China and be spent in China. Kinda like Disney-land money.

It all depends on the company. Some pay in yuan, some pay in dollars. Or some may pay in both, to get the best tax deal out of Chinese laws.

The only way for pruchasing power to double is to have the price of EVERYTHING fall by 50%. This won't happend when the ex rate is 1:4. The prices in RMB will fall, just not by that much.

Does anyone know if foreingers working for foreing co's in SH get paid in RMB or $?

Basically, going from 8.28 yuan to the dollar to 8.11 yuan to the dollar at this point isn't going to screw up those rough 8 yuan to the dollar conversions Americans have been doing in their heads. And in the case of a big revaluation (which is highly unlikely)? Well, you'll be rich when you go back to America if you've been living in China getting paid in yuan. If you're getting paid in dollars here, those dollars aren't going to translate to much in yuan.

I don't get this whole revaluation thing. Today I go into a restaurant and pay 40 RMB for lunch, which as a foreigner I automatically convert to be about $5. If tomorrow the Bank Of China says, "Now the exchange rate is $1=4 RMB", does that mean my lunch now costs $10? Do local expenses like food and rent fluctuate with the exchange rate? Does a farmer in Sichuan have his income double, ie his purchasing power doubles, in the same scenerio? Any economists out here? Hello? ...Anyone?