"Money is nothing but a medium of exchange..." - Ludwig Von Mises, The Theory of Money and Credit, p. 31

By John Tamny

President Obama's arrival in China has predictably generated all manner of commentary about the economic relationship between it and the United States. Not surprisingly, the majority of the commentary has been economically untrue, misguided, or both.

First up is the notion that China artificially keeps the value of the yuan lower than it would naturally be. What this commentary misses is that currencies aren't commodities, rather they are concepts. Nothing else.

In that sense, China is one of many countries that pegs its currency to the dollar in order achieve for it a measure of credibility due to the dollar being the world's currency....