If the yuan isn’t stable, it will bring disaster to China and the world. If we increase the yuan by 20 percent-40 percent as some people are calling for, many of our factories will shut down and society will be in turmoil. If China’s economy goes down, it’s not good for the world economy.

This is China Premier Wen Jiabao, as quoted by Bloomberg News.

Get that? The United States should continue to export jobs to China as some sort of global social program. We should continue to give the Chinese people our jobs so they won't raise hell and revolt. We should allow China to continue to manipulate it's currency, capturing global manufacturing capabilities to keep the Chinese government in power. Wow. Maybe we should import Chinese potential social unrest, for the United States policies are stiffing the U.S. worker and the cries from the Populist are a muted whimper.

Jiabao also chastised the EU for joining the United States in demanding China re-evaluate their currency and blamed the United States for currency fluctuations. Businessweek:

Europe shouldn’t join the choir to press China to allow more yuan appreciation. The euro had a big fluctuation recently. It’s not because of yuan but the dollars. We shouldn’t be blamed for it; if there’s someone to be questioned, it should be the U.S.

Meanwhile the ineffectual austerity loving IMF is deemed global currency cop. U.S. Treasury Secretary Geithner, at least is pushing harder for China to float their currency, although these actions are due to severe pressure from U.S. manufacturers, trade unions and Congress.

The best video report on the latest from the currency wars front is the below Wall Street Journal piece. Bear in mind you'll hear the same ole' platitudes of protectionism, but notice how the IMF basically wants to do nothing, more delays, and also notice how money, investments are flowing into emerging economies at the expense of nations like the United States, and more importantly the citizens, labor force of the United States.

IMF Criticizes Currency Fights

There is an international monetary system, called Brenton Woods II. Over a year ago, the demise of Brenton Woods II was predicted.

Tim Duy's FedWatch believes the end of Brenton Woods II will be declared November 3, 2010.

The inability of global leaders to address global current account imbalances now truly threatens global financial stability. Perhaps this was inevitable - the dollar has not depreciated to a degree commensurate with the financial crisis. Moreover, as the global economy stabilized the old imbalances made a comeback, sucking stimulus from the US economy and leaving US labor markets crippled. The latter prompts the US Federal Reserve to initiate a policy stance that will undoubtedly resonate throughout the globe. As a result we could now be standing witness to the final end of Bretton Woods 2. And a bloody end it may be.

Currency manipulation is simply the opening salvo for a host of policy and incentive changes needed in the United States to turn it's economy around. Notice how the United States is declared a consumer economy, while China is declared a production one. Not good when all America is perceived globally to be a nation of shoppers, instead of workers.

Meanwhile Bloomberg reports economists are expecting a blow out trade export report from China, to be released tomorrow.

See China's currency manipulation makes America See Red for more background.