waterlily
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User ID: 51323695 United States 03/17/2014 03:09 PM Report Abusive Post Report Copyright Violation | Chinese Currency Faces Critical Test in the Next Few Weeks With the ending of China’s two big political meetings (Political Consultative Conference on March 12 and the National People’s Congress on March 13), the time has come for big and difficult economic decisions concerning the exchange rate. The exchange rate for the yuan is an urgent issue and the Chinese authorities have to decide whether a one-time big depreciation or a gradual depreciation is in their interest. There’s no time to lose. China’s M2—cash plus highly liquid assets, such as money market accounts—stands at around the equivalent of $20 trillion at the current exchange rate. Much of that money is “hot money” from abroad that is ready to leave China at any moment, so the 3 trillion dollar foreign reserves of China will decrease quickly in the event of a currency crisis. Now that time is coming: with the introduction of property tax to be an important part of local government revenue and government policies to hold down price appreciation, property prices have started to fall in many cities. In Wenzhou and Hangzhou and other smaller cities, the property bubble (at least three times more serious than U.S. bubble in 2006 in terms of housing affordability) is in danger of a full-scale blowup. The economy is in a serious downward trend because business owners have to worry about their family safety instead of running their businesses in the current extremely corrupt and dangerous political system, while the state sector is not competitive in the face of foreign competition and is losing market share across the board. [ link to www.theepochtimes.com] *********** WaterLily *********** " Do I dare Disturb the universe?" -- T. S. Elliot, Love Song of J. Alfred Prufrock ************************************* “We are as ignorant of the meaning of the dragon as we are of the meaning of the universe.” -- Jorge Luis Borges ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ "Pompey made his preparations for the war at the end of the winter, entered upon it at the commencement of spring, and finished it in the middle of the summer." -- Cicero, De Imperio Cn. Pompei |