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November 16, 2009



Interesting, so why would Obama be in China suggesting that they need to diversify from the American economy?

John Robb

A warning before the hammer is forced to drop. The dollar peg is untenable.

bella horrida bella

Of course revaluation of the renminbi is an effective devaluation of the dollar.

Doubtless the Chinese will recall, with an eerie sense of deja vu, that America paid for the Vietnam war by stuffing Europe full of dollars, and then devaluing the dollar.

The Communist Party of China still has a very large card up its sleeve. It could completely deregulate the economy and so create a massive boom, the mother of all bubbles, and see how the United States likes that. A risky move to be sure, but they might just get away with it.

Those, on the other hand, who would enjoy seeing the statues of Mao toppled and blood in the streets, might pause to think about what would replace the Communist Party. There is more than a possibility that it would be an aggressively nationalistic and xenophobic regime. Difficult to see how this would be in the interests of the United States, or of anyone else.

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