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Chinese 30-Day Repo Rates Don't Buy The CNY Revaluation Bluff
The direct correlation between the 30 (and 7) Day repo we pointed out on Friday, may have broken... At least on the surface. Whether the point of the depegging was to loosen tight interbank lending, via CNY/USD funding imbalances, or just to shut our worthless SecTres up for a few months, it is unclear. What is clear, is that at least for now, there is no knee jerk improvement in 1 month interbank rates, which at 3.9%, have just hit a fresh 52 week high. The direct conclusion: at least Chinese banks, if not idiot futures traders, are seeing beyond the PBoC's little scam - the depegging is ultimately devaluationary. Everything else is just smoke and mirrors ahead of the G-20.
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I think all G-20 meetings should be held in remote arctic locations (Inuvik was a great location). Won't waste 1 billion dollars.
Surely one of these goblins has an impenetrable lair somewhere.
^^ how the hell do you manage to turn a post about collateral pledged by CN banks in REPOs into a rant against the G20. Unbelievable.
"Everything else is just smoke and mirrors ahead of the G-20."
You read the story and wonder what the hell it's about because a big thing is doing nothing and then decide the last sentence is the most important. Because it does seem like smoke and mirrors. Kind of like an anouncement that hasn't been reacted to yet.
No no; my comment was meant to go to those two commentators above me. I know what the story is about since I asked the question to which the answer is this story; it just appalls me that every post that gets written here gets at least 10 off topic populist comments that are worth shit.
you sound surprised. ?
Na. You're just pissed off that theres still tons of stuff to figure out and people can't be bothered to do anything but read useless crap and parrot it.
Face it. Shit is hitting the fan but it's being entirely drowned out by sideshow shit hitting the fan. You know it and I know it. We go off dollar as underpinning oil on june 3rd but it's not showing up like we think it should because you got golf spills magically happening a few weeks beforehand. You got half a dozen countries chomping at the bit to attack iran and they can't get enough "support" to go through with it and they don't know any other way to get the dollar back in oils ass. It's a total cluster fuck and you are too tired and weary to put up with the mindless background noise.
So just remember gold and oil never flow in the same direction. Western world is out of gold and the only way they can get it back is to try to control oil. Nobody wants to buy the carbon credit crap, nobody will let them beat up enough people to take enough control over it. If thinking and analyzing were easy everyone would do it and it would be easy.
honestly, i dont really get the market response. chinese are being urged to buy gold and silver.. does anyone think that imports will increase??? or, that it is good for the world that walmart prices will go up??? unit prices of all goods that have any manufacturing element in china (aapl) will increase... if the american consumer is already spent to the point where they are walking away from their houses, how is it a good thing that retail prices will increase? im just not feeling it...
clarification... if the yuan now is worth more, i dont think chinese households will take advantage of this increased purchasing power to buy crap from any other country... rather, they will likely use their increased purchasing power to buy more gold and silver..
interesting move in the repo rate in june. please keep us posted on this.
They dont understand what they are reading Cheeky. My mum always said "best not to post and appear stupid, than post away and remove all doubt"
how cute. Is you mommy also posting on this site?
Meanwhile, investors worldwide are making large bets that the Yuan will revalue and gain value versus the U.S dollar. Ironically, this intensifies the potential of a Yuan crash, since the presence of so much speculative funds is going to overweight China’s foreign exchange reserves. If China decides to let the Yuan float, it may go up initially but once foreign investors take the money out of the country once the revaluation has been done, the flow of capital will drain China holding of FX reserves since it will need to sell them in order to prevent a Yuan collapse.
The Next Black Swan- A Yuan Devaluation
I don't think the RMB will depreciate either. The Chinese version of the PBoC statement explicitly ruled out "volatility" instead of just appreciation as in the English version.
EURO buying support i've mentioned over the past few weeks has resulted in a bullish basing pattern on the daily chart. The important weekly chart remains bearish though.
http://stockmarket618.wordpress.com/about
The direct conclusion: at least Chinese banks, if not idiot futures traders, are seeing beyond the PBoC's little scam - the depegging is ultimately devaluationary.
Could someone pls.explain in what way it's a scam, (what's the real intent then,) and how it is "devaluationary." (I suppose that means for the Yuan, but not sure what writer meant. tks.)