Hello EP, You have highlighted one of the many problems of a RMB repeg right now, because ...
<<1) Sell volitility on RMB / USD>>
... no deep market and no sufficient instrument for manufacturers to do as you suggest;
<<2) Help the money go in.>>
... no sufficient investment opportunities inside for the money, especially given that China is a high-savings country, and so the hot money will get impatient as China's inflation heats up, Chinese domestic money HEADS for HONG KONG [EDIT: hint on what I am thinking :0) ], and China's trade deficit gets worse ;0)
<<3) Help the money go out.>>
Yes, you see what a little bit of rumination will lead to? Dangerous thinking, but very tempting:
Find a place to wait for the RMB to show up, ambush, and then loot, followed by a quick dash into the darkness.
Perhaps Hong Kong ocean front real estate, financed at 2.5% HKD loan, yielding 7.2% rental, floating on Greensputin deluge and BurnAndKaput ink !!!!
Same for HK dividend-yielding real estate shares !
Same for publicly traded HK stock exchange and local banks !!
Could it be? Is is possible? That it is Party Time again !!!
I must think and guess some more.
Chugs, Jay |
