When the Reminbi is fully convertible, the end is nigh. Rats need a new ship, before they jump the old one. This is it.
They're just trying to hedge against a potential Romney victory. He has constantly vilified them as a currency manipulator-- which they are. The global imbalances that exist are because of the black hole that is China. Bernanke can't print dollars fast enough and lazy and cheap US consumers can't buy cheap Chinese crap fast enough. Politicians here are such wusses thus the game continues. When the markets determine the true value of RMB, only then can we get back to some global economic stability. Personally, I think we should uses China's own words against them: "China will do what is in the best interests of China". Therefore, the US "should do what's in the best interest of the US". I would peg the DOLLAR to the RMB at 3:1. Boom, I just eliminated half of the US deficit overnight! Instead of China parking their economic surplus in non-interest bearing treasuries, they should spend the surplus on improving their citizens quality of life, and not just creating the fastest rising class of billionaires through govt patronage and ghost cities. Start with indoor plumbing and move west to east. With their new found currency strength, they can demand that their US factories work faster and harder. More manufacturing comes back to the US, net exports become more balanced, GDP growth occurs, US has to offer a real rate to entice lenders, inflation goes way down, peace on earth. Standard of living rises in China, communism is overthrown, oligarchies quickly sprout up, business and investment start to boom. It's time the globe stops carrying the world's second largest economy. They are no longer "emerging" and to play with the same rules as everyone else.
"You can always count on Americans to do the right thing - after they've tried everything else." - W. Churchill
And also read book of Mao so you understand that currency and elements of free economy are just temporary and necessary evil until communists get to more power preferably globally. Then you will not need any currency. It will be Cambodia of Khmer Rouge.
I am not sure Americans are the beneficiaries or victims of American systems. Today, I sit a a restaurant and bought food that says 'No antibiotics or growth hormone'. My thoughts went forward along the line. Meats in America have growth hormone added, that is one of the reasons Americans are larger and heavier. I wonder if the growth hormone has other side-effects, such as impaired American's mind and body dexterity, meaning dumb and clumsy. I started liberally observe people in the restaurant. I do not expect to get an honest answer from the establishment, that orchestrated the growth-hormone practice.
Or worse we could turn into an entire planet of delusional suburbinites thinking we will get to the middle class lifestyle again. More than likely this will just expidite the globaliztion process and the corperations will take complete control. Akuma
"currency backed with gold, pal" = gold standard gold standard = deflationary monetary policy deflationary monetary policy = industrial collapse industrial collapse = socio-political revolution Confucious say: "Chinese leaders may be inscrutable, but they are not suicidal."