Big Mac Index

Purchasing-power parity is like a special calculator that helps economists compare different countries' currencies based on how much stuff you can buy with them.  Imagine you have a $10 bill, and you want to buy some candy. In the United States, that $10 might get you 10 candy bars.

America’s Treasury Department removed the designation of currency manipulator from China five months after the moniker was given.  This seems reasonable since the two countries were in the process of negotiating the now-signed “phase one” portion of a larger trade agreement.  Pejorative monikers probably don’t make deliberations easier.

Many comparisons between the U.S. and Chinese economy have been made lately both in the press and by numerous talking heads.  At our most recent Pie Party this topic came up for discussion.  Caught by surprise, J R (incredibly!) turned to technology for an answer.  He brought up the Big Mac Index.