i would venture to guess that chanos is now fairly to very quiet about china, because he sees the wrong of his ways
shorting bhp and rio tinto could not have worked out too well fot him, and certainly not as he expected, especially given what happened to the aussie dollar
shorting anything else china-related and liquid enough for a shorting exercise could not have worked well enough
as to china is dubai times 1000, maybe, but then we could be soon talking times 10,000
the problem with commonly held premise is that they are rarely sound platform from which to launch a trade
as to china taking over this or that, doubtful
returning to 35% of global gdp sharing, almost certainly, and why not? it is mathematically sensible.
as to the cry babies in japanese parliament and usa congress, wimping about "do not buy my zero% yielding jgb" and chanting "currency manipulation", for they do not for a moment confront the truth, and there are at least two:
(i) should japan not wish to be tee-ed by its zirp currency via china purchase of jgb, stop borrowing, and the purchase of jgb would naturally stop
(ii) where does china get the usd with which to buy either and or jgb or t-bills? from team usa printing press, one would guess. stop printing, and the t-bill purchases would, again, naturally rather than miraculously, stop
my guess is that ignorant commoners such as hamoon would, in their naive attempt at ignoring and then manipulating history and sincere effort to 'create' jobs, try competitive devaluation first; and
when that fails in alignment with history, which it will, tee-up tariffs, which would also fail to make things better, but should be quite successful in making things worse.
zero state reset is unavoidable, just about for sure. the timing is poor, because baby boomers are poor.
if i wanted to short china, i would short t-bills, that which all is rushing into and china is exiting, and go long jgb :0)
or just short naked puts of gdx and gld and paas ;0)
competitive devaluation is well on, tariffs are coming, and when so, the dreaded 'deflation' concurrent with genuine inflation. so, between short t-bills and going long gold, i choose the latter |
