The yuan will devaluate instead of revaluating when the chinese real state bubble collapses. Chinese will say to America: "Hey we finally free floated the currency as you wanted, it's not our falt if it's devaluating instead of revaluating". i.e. Google Ordos, one of at least a dozen chinese Dubai-style ghost towns: http://www.youtube.com/watch?v=0h7V3Twb-Qk http://www.time.com/time/photogallery/0,29307,1975397,00.html http://www.weirdasianews.com/2010/04/15/ordos-chinas-modern-ghost-town/ http://googlesightseeing.com/2010/09/ordos-chinas-vacant-city/ The official 28,000 inhabitants figure is a lie. Being china nobody can verify or refute it without facing a firing squad.