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Foreign Trade
The fragile web of foreign trade - The Economist May 28,2009
The nuts and bolts come apart - The Economist March 26, 2009
Survival of the fattest - The Economist May 12, 2011

What does economic historian Nial Ferguson mean when he refers to Chimerica? Can China afford a serious downturn in the U.S. economy? When the world economy shrank in 2009, what happen to trade policy? "Survival of the fattest?" Why are these businesses more vulnerable?

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Solution Summary

The solution answers queries from three (3) readings culled from the articles published from The Economist, namely, "The Fragile Web of Foreign Trade" (May 28,2009 issue), "The Nuts and Bolts Come Apart(March 26, 2009 issue), and "Survival of the Fattest (May 12, 2011 issue).

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What does economic historian Niall Ferguson mean when he refers to Chimerica?

'Chimerica', according to Ferguson and Schularick, connotes a symbiotic relationship between China and America. This relationship is manifested in this manner: "Chinese people save allowing Americans to borrow and spend more than they earn while American consumers buy gizmos made in China, keeping Chinese workers in jobs". Both countries come into a mutually benefited Chinese and Americans. (Source: The fragile Web of Foreign Trade - The Economist May 28,2009)

Can China afford a serious downturn in the U.S. economy?

No. It cannot. Make no mistake ...

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