The NYT went a couple of miles over the top with Peter Eavis' analysis of China's currency devaluation. It begins by telling readers;

"For years, China looked like the principled noncombatant. As other countries, seeking to secure an economic advantage, let the value of their currencies slide on international markets, China held firm on the value of its money."

"The principled noncombatant?" What are they smoking over there? China accumulated more than $4 trillion in reserves to keep its currency from rising against the dollar. China looked to the world outside of the NYT like the principal combatant. This massive intervention led China to run massive trade surpluses, peaking at more than 10 percent of GDP in 2007.

Fans of economics everywhere know that fast growing developing countries like China are supposed to run large trade deficits, as capital is supposed to flow from slow growing rich countries to fast growing developing countries. Given China's 10 percent plus annual GDP growth a trade deficit of 10 percent of GDP would have been reasonable, instead China had that reversed.

This also explains the massive housing bubble in the United States and other wealthy countries. With trade deficits creating enormous gaps in demand, the only way they could be easily filled was with demand driven by asset bubbles. (We could have filled the demand gap with large budget deficits, but people in positions of power in Washington are superstituous, so we can't run large budget deficits to fill demand gaps.)

The rest of the article is no more in touch with reality. It tells readers:

Those pushing to cut and/or privatize Social Security have long tried to rest their case on an appeal to generational equity. They argued that the taxes needed to support baby boomers would impose a crushing burden on our children and grandchildren.

This argument flies in the face of reality. If we see the sort of wage growth projected by the Social Security trustees, and if it is evenly shared, then real wages would be 55 percent higher in 2045 than they are today—a $61,388 median annual wage compared to $39,560.

Suppose that we close the projected shortfall in Social Security entirely by raising the Social Security payroll tax, with no other revenue increases and no cuts in benefits. In this case, our children would see after-tax wages that are 51 percent higher than what we earn today, with a median wage of $59,547.[1] It’s hard to see the generational injustice here. (It is worth reminding those who consider this tax to be a generational injustice itself that we now pay a far higher tax rate than our parents or grandparents did.)

Yes, I know oil is priced in dollars, not euros, but it doesn't make one iota of difference. In an article on the meaning of the drop in the value of the yuan on people in the United States, USA Today told readers:

"China, the world's second largest economy, consumes a lot of oil, second only to the U.S. However, oil prices are denominated in dollars, so a gutted yuan means China's purchasing power is reduced, which could prompt the Chinese to spend less on oil-based products. That reduction in demand could lower prices, an upside for American drivers."

Everything in this paragraph would be equally true if oil was priced in euros. The Chinese currency is now worth less measured in dollars, euros, yen, or oil. The loss of purchasing power will lead China to buy less of everything that is produced abroad, including oil. The fact that oil is priced in dollars matters not at all.

As a practical matter, anyone hoping to get super cheap gas due to less demand from China is likely to be disappointed. If we assume that the 2 percent drop in the value of the yuan leads to 2 percent higher gas prices in China, and we assume an elasticity of demand of 0.3, then China's gas consumption will fall by roughly 0.6 percent as a result of the devaluation. This almost certainly has less impact on the demand for gas than even a one-year reduction in China's growth rate by 2 percentage points. If the devaluation and other stimulatory policies speed growth in China, then we may see increased rather than decreased demand for oil from China.

The piece also gets the story of U.S. companies manufacturing in China somewhat confused. It tells readers:

August 2015, David Rosnick

Two months ago, CEPR released a report on changes in the prime-age employment rate since the beginning of the recession in December 2007. CEPR used the prime-age employment rate rather than the unemployment rate for a specific reason: in order to be counted as unemployed, a prospective worker must “have actively looked for work in the prior 4 weeks.” This means that if someone has been searching for work for a long period of time, but has become dissatisfied with their prospects and hasn’t applied for any jobs over the previous month, he or she is no longer counted as “unemployed.” Paradoxically, if enough workers become discouraged with their job prospects and give up their searches for work, the unemployment rate can fall even as the job market is weakening.

In order to correct for this and other problems, it’s best to analyze rates of employment rather than unemployment. However, if we look at the employment rate for the U.S. as a whole, we miss out on the changing age distribution of the population: if the population is aging, a greater percentage of the population may hit retirement age and willingly retire, which doesn’t imply a weaker job market. Conversely, if the population is becoming younger, a greater percentage of the population may enroll in high school or college; yet this tells us nothing about employment opportunities for those who want to work. A simple way to correct for a changing age distribution is to limit one’s analysis to the “prime-age” population (Americans aged 25 to 54). The most recent job figures show that 77.1 percent of all 25-to-54 year-olds were employed in July. This means that the labor market has made up just 2.2 out of the 4.8 percentage points of prime-age employment that were lost between December 2007 and September and October of 2011.*

Mark WeisbrotPúblico, 7 de agosto, 2015

Jake Johnston 
Alterpresse, 8 août 2015

Dean Baker
Truthout, August 10, 2015

Last week, the Bureau of Economic Analysis (BEA) released its GDP report for the second quarter of 2015. The BEA’s findings were generally positive: it reported that the economy grew at an annualized 2.30 percent rate between the first and second quarters of 2015, and it revised its first-quarter growth estimate upwards by 0.8 percentage points. Over the past year, real GDP grew 2.32 percent, in line with the second-quarter growth rate. This is 0.21 percentage points better than the average growth rate of 2.11 percent since the second quarter of 2009, when GDP hit its end-of-recession trough.