Caveat emptor: this response is a bit rambling and Im not an economist so could have gotten some basics either wrong or missed off important bits.
A weak Yuan policy has, generally, been good for China.
Self interested, fiscal guff about "currency manipulation" is not helpful in finding multilateral solutions.
And it has been bad for Chinas international competators, other low labour cost countries. It has also stored up the problems we are seeing now. Even if it was good for China but inflated trade surpluses would eventualy have to correct. By having a delibertaly low Yuan the trade imbalance was greater than it otherwise would have been. China, like Japan, Russia and Saudi choose too buy US debt, this meant the interest on US lending was kept low and the US government, banks and consumers could buy things like oil, barbie dolls and dvd players. I find the word neoliberal very appropriate as the people in charge of the global economy are certainly not classicaly liberal economists. They all enjoy there market distortions just so long as they benefit from them.
Our current economic system is the result of centuaries of trial and error. I think (unless someone can convince me otherwise) that currencies should either be freely traded (all of them) or have values set by some form of Bretton Woods type system. Having a system where countries can manipulate there own currencies value is what exsacibated the great depression, the so called begger thy neighbour game where countries tried to each undercut the other by lowering the value of there currency. This created trade wars and set higher and higher barriers. The post WWII economic world was one where a determination that this must never happen again was a huge concern. Globalisation and interdependent trade networks were (and can still be) a huge part of ensuring the world does not slide into trade wars and global wars. The left was as keen as any to create an international system of open trade. It is how the EU was founded, by creating open markets and interdependence for coal and steel as a deliberate means of reducing the risks of war. The idea of opening borders is a great thing, but in its current format this movement has long since been hijacked as a means of opening
some borders more than others..... it is not about free trade but exploitation. That should not distract from the idea that free and equal trade is a good long term goal. Where currencies fit into this is that all currencies should all play with the same rules. Either a system of fixed currencies or a system of freely traded currencies. A system where the Yuan can be set against the dollar but the South African Rand not, beggers the Rands employees.
Currencies should in theory work that when two countries trade with each other that trade helps set the currency. If country A can make widgets cheaper than country B, it will sell more to country B aquiring its currency in return. Eventualy country B will go bankrupt as it has no more currency to buy widgets with, so country B will need to sell something to country A to get some of As currency. (This is hugely simplified). The value of the two currencies should shift until the amount of money passing between the two is basicaly the same..... or one will go bankrupt. Take this very very basic model and expand it to the world and this is the theoretical system that international trade should work on. It does not. America gets to sell debt to make up the trade gap and countries buy that debt.
America disproportionaltely benefited from the current econmic set up by being given huge amounts of the money they had spent to buy oil and goods back in the form of debt. But the people who bought this debt did so not through coersoin but because they wanted too. China benefited by being able to set its currency against a system of free floating ones and sterilising its incoming dollars by buying debt and sending them back to the US to buy more Chinese goods.
This is just one more breach of the theoretical rules that the post war compact of expanding internaional trade was supposed to have. Its aims were to spread wealth (the theory that wealth is not a zero sum game) and to reduce the chances of another war.
Offcourse this ignores the worldwide ignoring that we are reaching (or have grossly exceeded) the enviromental limits of the system that supports the economy. We are extracting more from the soil, fish, water, energy and other extractive resources than is being replaced and are running out of the capacity to expand (frack it we will be running out off them very soon) and we are running out of enviromental sinks for our pollution (CO2, rubbish, plastics, water pollutant, etc).
