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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: sea_urchin who wrote (21776)	10/28/2004 5:16:30 PM
From: The Wharf	Read Replies (1) \| Respond to of 81050

>>Yes, growth will "cool" from 10% to 9%, or something like that. But why I am confused is because if the Chinese economy contracts, they will have less to invest in US debt instruments. Accordingly, one would expect the USD to fall -- but it didn't happen. So something is wrong somewhere. You confused me as this assumes that the US is tied to China by the peg she is not China is tied to the US but the US is not tied to China. . If Chinas economy falters due to excessive inflation it is her problem and is a plus for the US. Deflation takes place in China and inflation is curbed here. This is not good for people in China. It however reduces the US dollars coming back and increases the future value of those dollars. Debt instruments theoretically should then be worth more. Does this make sense? I think China is in trouble the growth was just to fast and poverty level too large. Her currency due to the peg had too many dollars hitting her market at once. Even a whiff of inflation in her low income nation is too much.

To: sea_urchin who wrote (21776)	10/28/2004 6:12:34 PM
From: The Wharf	Read Replies (2) \| Respond to of 81050

If you think of future consumers and the pledge in Asia to stop tariff amongst Asian nations the peg to the US is not advantageous. What I do not know is if the peg is dropped how will that affect the currency market? Does the solution lie in some attempt to create a Euro type currency in Asia. There is not enough unity in Asia to allow an exiting currency to be used as prime unit so the US$ has played that roll. I am sure there is allocation to the Euro when Asia herself is moving out of impoverished. This takes me back to the interior ability of currency to appreciate in value not increase numerically which makes one inflation prone. I am certain that China will end the peg she has too. Highly imaginative over here can add to that as so much confusion that the result by fluke ends up to be a run for gold that makes the tech bubble look like a wee tiny pimple on the face of this earth. Made in China has become an universal label of the World.

To: sea_urchin who wrote (21776)	10/28/2004 10:17:55 PM
From: sea_urchin	Read Replies (1) \| Respond to of 81050

> Next week, they can threaten to raise interest rates a bit more quote.bloomberg.com >>The two currencies [NZD and AUD] fell in the minutes after the People's Bank of China said its one-year lending rate will increase by 0.27 percentage point to 5.58 percent. Along with the Canadian dollar and South African rand, they later erased losses on speculation China's economy won't slow so much that demand for commodity exports will stall. ``A 27 basis-point move in China's interest rate won't slow the economy,'' said Niels Christensen, a currency strategist in Paris at Societe Generale SA. ``We'd have to see much more for commodity prices and currencies to move lower and stay lower.''