■"A New Pattern Is Cut for Global Textile Trade: China Likely to Dominate as Quotas Expire," by Peter S. Goodman and Paul Blustein, Washington Post, 17 November 2004, p. A1.

■"China Unlikely to Float Currency Soon, Official Says," by Jill Dutt, Washington Post, 13 November 2004, p. E1.

■"Zhou's Theories Clash With China's Realities: Scholarly Central Bank Head Finds Market-Based Tactics Hit Local Political Obstacles," by Andrew Browne, Wall Street Journal, 15 November 2004, p. C1.

China's growing influence over the shape and tone of not just the global economy but the very essence of globalization itself receives a boost with the new rule set coming to the global textile trade thanks to the World Trade Organization. This vast revision of the rule set, which hits factories worldwide on 1 January 2005, is "expected to jeopardize as many as 30 million jobs in some of the world's poorest places as the textile industry uproots and begins consolidating in a country that has become the world's acknowledged low-cost producer: China."

We're talking about $400 billion in trade, so this new rule set's impact will be huge. Maybe now people will stop describing globalization as an American-led multinational corporation plot to rule the world and start understanding the process as being so much bigger than just the U.S. economy. Increasingly, the purveyor of both pain and delight will be China.

And they seem to know that more and more, hence their growing willingness to discuss the eventual floating of the yuan (talking is one thing, actually doing is another). I remember the people back at Cantor Fitzgerald (during the NewRuleSets.Project I describe in PNM) talking about how, someday, when China was forced by global economic circumstances to finally float the yuan, that that alone would be its own new rule set.

Everyone agrees (and the US especially argues) that the yuan is set too low at 8.3 to the dollar, thus making Chinese goods seem cheaper on global markets than they should be. But you have to be careful what you wish for, given China's now great prominence as a source of global economic growth. A floating currency is one thing when you have Alan Greenspan armed with all his tools of manipulation, but as the article on the Chinese "Alan Greenspan"notes, Zhou Xiaochuan lacks many of those controls (even as Chinese newspapers praise him as a "good student of Alan Greenspan."

Here's Mr. Zhou's problem in a nutshell:

But unlike Mr. Greenspan, Mr. Zhou doesn't decide interest rates. The central bank has a voice in monetary policy, and a growing voice under Mr. Zhou, but final decisions are taken by the Communist Party's Politburo.

Although Mr. Zhou has a long way to go to match Mr. Greenspan's power, just the fact that he wields the influence he does is a big step forward for China. Yes, the guy survives now and then on his personal connections (former leader Jiang Jemin was a patron), but he's also bringing in a lot of foreign-trained talentóso-called sea turtles. "Sea turtles" is a Chinese pun (as much of Chinese humor is, due to the great variety of ways one can pronounce individual words in Mandarin) that refers to people in China who travel abroad for study and later return. So one of the jibes against Mr. Zhou is that he is "too fond of sea turtles," packing his staff, as he does, with U.S.-trained economists.

Probably a Chicago Boy or two in that mix.

Let's hope they give him sound advice, for like Mr. Greenspan, Mr. Zhou holds a big chunk of the world's collective economic future in his decision-making hands.