Dow Jones up 200 on Monday! U.S. gets China to act on elevated Yuan!

Big moral hazard here. Way too many specs piling in on this "one way" bet of appreciation. The central bank of china shouldn't announce their policies like this. China is already far too attractive to hot money capital flows.
 
Quote from tradingjournals:

Why do you think US stocks will rise?
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The dollar will fall relative to the Yuan. US goods will get cheaper. China will import more of our goods. That is good for our stock market.
 
Quote from Petsamo:

The dollar will fall relative to the Yuan. US goods will get cheaper. China will import more of our goods. That is good for our stock market.
More...

I am amazed at how people and the media thinks this means the Yuan will be revalued.

I have been saying for the past month on my blog. The Yuan will devalue, and here is their excuse. The Yuan will be priced against a basket of currencies, good news yes?

Well what if that basket were say 50% USD, and 50%EUR. Where do you think the Yuan would be relative to the USD? Oh yeah DEVALUED!

And I am not the only one thinking this:

http://www.reuters.com/article/idUSN1915926720100619

So what everybody better start hoping is that the Euro goes up against the USD because if it does not... Yuan drop here we go!

But of course the mainstream media like CNBC can't stop harping about how bad things are in Europe... Yeah right, did you know the all of the German car makers are running shifts on Saturday?
 
O'Neill Predicts Yuan to gain 1% when markets reopen Monday. Assuming that's the case, does the US stock market rise or fall?
 
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