Quote from bond_trad3r:
This is stupid. U.S. can do QE2 and Yuan would rise anyway. What I'm trying to say is Yuan is going higher regardless.
Quote from Tsing Tao:
you need to think before you open your mouth and just spout off.
it is quite possible that the QE2 madness (in spite of just about everyone saying how bad it would be to do such)) is being done to force China's hand in unpegging to the dollar. essentially what the fed is doing is saying "fine, you want to stick to the dollar no matter what we say? we'll flood your economy with trillions of dollars looking for a home. the inflation that will hit you will make you wish you pulled the peg." china can raise rates until the end of the world. but if it maintains a cheap dollar, and the dollar is cratering because the fed is trying to shake it (and other asian currencies) loose, then inflation will come to a chinese home near you.
go ahead, try capital controls. try intervening in forex markets, or pegging. you cannot fight the fed because the fed owns the reserve currency printer. benny and the inkjets will win out in the end.
it is quite probable that china realizes this and they (along with many other asian countries currently cowering in fetal positions at their currencies) are willing to finally play ball.
that may be the one thing that stops QE2. and if it does, watch out below for market corrections on a grand scale.
Quote from Tsing Tao:
you need to think before you open your mouth and just spout off.
it is quite possible that the QE2 madness (in spite of just about everyone saying how bad it would be to do such)) is being done to force China's hand in unpegging to the dollar. essentially what the fed is doing is saying "fine, you want to stick to the dollar no matter what we say? we'll flood your economy with trillions of dollars looking for a home. the inflation that will hit you will make you wish you pulled the peg." china can raise rates until the end of the world. but if it maintains a cheap dollar, and the dollar is cratering because the fed is trying to shake it (and other asian currencies) loose, then inflation will come to a chinese home near you.
go ahead, try capital controls. try intervening in forex markets, or pegging. you cannot fight the fed because the fed owns the reserve currency printer. benny and the inkjets will win out in the end.
it is quite probable that china realizes this and they (along with many other asian countries currently cowering in fetal positions at their currencies) are willing to finally play ball.
that may be the one thing that stops QE2. and if it does, watch out below for market corrections on a grand scale.
Quote from kashirin:
that's total garbage
why to destroy own country to force someone to revalue their currency?
PPI is 4% already. CPI more benign probably but QE2 hasn't started yet
what US must do is to implement tariffs to ban labour arbitrage
they will get burst in inflation and will improve fiscal balance