101–110 of 153 posts
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Printing tons of US Dollars to finance an enormous deficit in the balance of trade [1] seems way more unsustainable to me. The only reason it has been holding up until now is actually the US Dollar reserves of China [2]. [1]: https://upload.wikimedia.org/wikipedia/commons/b/b5/Handelsb... [2]: https://en.wikipedia.org/wiki/Foreign_exchange_reserves_of_C...
Reserves which fell by half a billion dollars last year, and still falling. This is why the funds are betting against the Yuan. How far is China willing to see it's reserves fall before it blinks? http://www.wsj.com/articles/chinas-foreign-exchange-reserves...
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It is not necessarily about the sustainability of the Chinese economy. No matter how much capital the hedge funds can muster it will be puny compared to PBoC resources. The real threat to the yuan is if regular Chinese become convinced of the trade. Hedge funds bet against the yuan because right now it is one-sided: meaning they don't need to worry about short squeezes as typical shorters would have to. If yuan were…
> No matter how much capital the hedge funds can muster it will be puny compared to PBoC resources This is incorrect. Hedge funds borrow and create temporary money by writing derivative contracts such as options, futures & swaps. It is by this logic they can actually muster more funds than the PBOC in aggregate. Quite simply the market for currencies is bigger than the PBOC and the hedge funds, but there are more hed…
If you are talking about non deliverables, who will be your counter party if everyone wants to go short?
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China recently and Japan from 1960-1990 took very similar paths to prosperity: Click on the max timeframe for the first charts below to see the similar growth curves: http://www.tradingeconomics.com/japan/gdp http://www.tradingeconomics.com/china/gdp
I think Japan stopped growing rapidly partly because they'd caught up with the west and couldn't keep transforming by copying more developed countries. I don't think China's there yet. Maybe if their gdp/capita goes from $6.8k (China) to $39k (Japan) that will be the case but there's a way to go.
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No, they don't. They might have "Americans are best", but not Us against the World.
I'll guess your country isn't on this list. > Instances of the United States overthrowing, or attempting to overthrow, a foreign government since the Second World War. (* indicates successful ouster of a government) China 1949 to early 1960s Albania 1949-53 East Germany 1950s Iran 1953 * Guatemala 1954 * Costa Rica mid-1950s Syria 1956-7 Egypt 1957 Indonesia 1957-8 British Guiana 1953-64 * Iraq 1963 * North Vietnam 1…
I'm not an expert on all of these, but I do know quite a lot about the Great Dismissal[1].
No credible person puts any weight to any theory regarding the US/CIA being involved in any significant way with the this. Wikipedia's coverage is fine (although it is also worth noting that the CIA funded just about every conservative group around during that period, so anyone who was a member was open to the same accusations Kerr was).
[1] https://en.wikipedia.org/wiki/1975_Australian_constitutional...
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Devaluing the currency is great for exporting countries, but remember that China's official plan is to develop a consumer based economy. People who use a devalued currency have no purchasing power and inflation can become a huge problem for growth.
Why does the economy need to grow? No growth = no bubbles = no busts. Don't see everyone's obsession with growth, growth, growth.
Yes, really.
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And yet, people will continue to praise people like Bernie Sanders. Centralizing government authority does not make the world better.
Government is not the only form of centralization of power. Private entities pose similar threats, at a certain point. Sanders: "If an institution is too big to fail, it is too big to exist." Government can centralize things, yes. It can also break up existing centralized markets...and increase healthy competition.
[1] http://yaleglobal.yale.edu/content/renminbi-undervalued-thin...
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It is not necessarily about the sustainability of the Chinese economy. No matter how much capital the hedge funds can muster it will be puny compared to PBoC resources. The real threat to the yuan is if regular Chinese become convinced of the trade. Hedge funds bet against the yuan because right now it is one-sided: meaning they don't need to worry about short squeezes as typical shorters would have to. If yuan were…
> No matter how much capital the hedge funds can muster it will be puny compared to PBoC resources This is incorrect. Hedge funds borrow and create temporary money by writing derivative contracts such as options, futures & swaps. It is by this logic they can actually muster more funds than the PBOC in aggregate. Quite simply the market for currencies is bigger than the PBOC and the hedge funds, but there are more hed…
Not all of them do macro bets, nor would they concentrate their position 100% against rmb.