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The Yuan is a basket case?

· Asian affairs · Economics, Business & Globalization

The G7 has agreed that the Chinese yuan should be part of an international basket of reference currencies. Does this technically make the Yuan a basket case? 😉

Yeah I know, slow day.

May 30th, 2015 |

12 comments to The Yuan is a basket case?

  • RRS
    May 30, 2015 at 5:57 pm

    The G7-

    An extensive group of politicians, academicians and their cohorts possessing many “valuable” clues in search of mysteries to which they might apply.

    That should help catch up.

  • Mr Ed
    May 30, 2015 at 6:09 pm

    It’s such a slow news day that Nick Clegg has made it. By being banned from his grandfather’s homeland, Russia.

    http://www.express.co.uk/news/world/581122/Bizarre-list-European-Union-bans-NICK-CLEGG-entering-Russia

    He joins outspoken critics of Russia as well as security officials who were named in a list by the Russian foreign ministry and handed to a European Union delegation in Moscow this week.

    The move has increased tensions between Russia and European states trying to stop the conflict in Ukraine.

  • John Galt III
    May 30, 2015 at 10:43 pm

    The Chinese wanted the Yuan to be part of the SDR of the IMF. When the current monetary system collapses and it will, it will most likely be replaced by the SDR until such time as a new monetary regime takes its place. The Triffin Dilemna doomed the dollar from the beginning of Bretton Woods in 1944. It is just a matter of time before the dollar is replaced as the world’s reserve currency.

    Read James Rickard’s books: ‘Currency Wars’ and ‘The Death of Money’ and follow him on Twitter. He has correctly predicted all of this and if you want to know where we are going on currencies, the IMF and how to protect yourself you would be wise to read him. You might also read Martin Armstrong.

    Capital controls are coming and worse as the Western experiment in socialism and the Ponzi Scheme financing being used finally blows up. As it does, Western countries will do everything possible to garb as much money as possible from its citizens as possible.

    Japan may go first followed by a Euro country or two and finally the US.

  • Laird
    May 31, 2015 at 12:57 am

    FWIW, I second JGIII’s recommendation of Rickard’s “The Death of Money”. I haven’t yet read his “Currency Wars”, but it’s on my list.

  • MSimon
    May 31, 2015 at 1:29 am

    The debt to GDP ratio of China is very bad. Some think it the worst in the world of any major country. And that list includes Greece. But China is too big to fail.

    The coming thing: crypto currency backed by productive assets.

  • Veryretired
    May 31, 2015 at 4:15 am

    When the thoroughly corrupt financial system of China finally implodes, it will be much worse than the Japanese or US breakdowns. For China, it will be another lost generation.

  • Laird
    May 31, 2015 at 4:33 am

    VR, you might be correct. Certainly the Chinese system is corrupt. But China has the luxury of holding immense quantities of US dollars (currency and securities) which can be dumped if/when necessary. I suspect that the Chinese system will eventually implode, as you suggest, but I think it will be a consequence of a Western breakdown. The world’s economies are so closely linked (with every country in the world now thoroughly committed to a fiat money system, which has never before happened in world history) that they will all go down together. But I expect China will be the last to go.

  • MSimon
    May 31, 2015 at 5:53 am

    Laird,

    The US dollars are what backs the Chinese currency. On top of that selling into a depressed market depresses the dollar further. Their incentive (as is the incentive of all the bankers) is to keep the fiction going as long as they can.

    I’m not so sure they will be the last to go. And if they are the difference may only be weeks. Not much comfort there.

  • Julie near Chicago
    May 31, 2015 at 8:43 pm

    I dunno, Perry. I think it is worthy of the proper recognition of the well-wrought pun: “Ee-e-e-wwww!”

  • Johnathan Pearce
    June 1, 2015 at 12:20 pm

    For serious reading about where the financial world is headed, I can recommend this.

  • Paul Marks
    June 1, 2015 at 1:43 pm

    “Crypto currency backed by productive assets”.

    Sounds like a scam – a bit like the Revolutionary France currency “backed by the productive assets of the nation – its land and….”.

    Still fiat currencies are also a scam – and the Chinese currency is a fiat currency (just as the Pound, Dollar, Euro, Yet…. are all scams).

    The first major country that accepts an actual commodity as money (not as “backing” – but as the money itself) will win.

    And if no where does – we are all doomed (TM).

  • Laird
    June 1, 2015 at 2:04 pm

    Jonathan, that’s the same book John Galt III already recommended. (But thanks for the link.)

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