talking of people getting angry, i must be recovering from that damn fever because this article made me obnoxiously mad ft.com/content/8e7379…
The view that China supported the $, that it's some kind of machiavellian puppet master gifting Uncle Sam a stronger currency and lower bond yields, REALLY?
China was invited to join the dollar system. It's size determined that it became the marginal price setter of global tradable goods but it needed $s to transact. Period
The deal was that the $ king was generous - that China could play silly buggars and slow the inevitable need for its cheap currency to appreciate. China didn't support the $, it did everything to keep the renminbi cheap
Don't get me started about Europe. Does China need euros to buy copper, ore or iron? i don't think so.
The day is coming when the Treasury will take control from the Fed. They'll want the $ @ 60. How will China react? They'll print CNH to buy lots more Treasuries. There is NO foreign sovereign choice under the $ std.
Play, Print, Buy $ Assets or WITHER...
