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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: 10K a day who wrote (88583)	9/9/2007 12:20:51 AM
From: Hawkmoon	Read Replies (1) \| Respond to of 306849

I would think China could do a MASSIVE sell-off of U.S. dollar holdings if the Fed tries to crash their market... And how would making the USD collapse assist their competitive advantage for the purpose of exporting their goods to the US? I see no benefit for them undertaking such a program. The Chinese have been buying USDs for a very specific reason.. to maintain that currency ratio advantage so they can sell to the US markets. If they re-export their dollar denominated earnings back to China, it only increases the value of the Yuan, while placing increasing pressure upon the USD, and making their goods less competitive. Thus, the only reason they threaten such an action is for political reasons. To actually implement such a "dumping" of USDs would be an act of economic suicide. And how would they explain the resulting collapse of the Chinese economy to all of those hundreds of millions of Chinese people who lose everything? Hawk