Devaluation of Chinese Yuan

[TPTB_need_war]

The Chinese are gearing up for something. First it was the "correction" on the stock markets and then they partnered up with the BRICS countries to create their own little circle of friends and now they are

devaluating the Yuan. It's as if they are preparing for a strategic move in the economic market. I would be worried if I was in debt to them at this moment.  

Do anyone else see this pattern or am I delusional? Break the economy and win the war before it started?  

I guess they would sooner break their neck. It may look as if they are up to something when essentially they may be just desperate in their efforts to save their own economy from collapsing...

Deep inside I never believed in China's economic miracle

I read today that Argentina (one of the countries they were signing deals with) has 1/3 of their foreign reserves denominated in Yuan, so this devaluation is hurting those who partnered on the Yuan as a reserve currency diversification (at least in the short-term but remember Armstrong's model is the $USD will peak 2017.9 or 2020.05).

Asia's economic miracle is still in place, because their debt is only at the corporate or LGO level and not unfunded social welfare liabilities to the tune of for example $125 trillion the USA owes the boomers. The West is demographically bankrupt, Asia is demographically fertile.

This Minsky moment correction for Asia will be completed by 2020 and Asia will lead up in growth while the wheels fall off the West from 2020 forward until Singapore and Shanghai replace New York and London as the financial capitals of the world by 2032.

The Yuan devaluation is more of a reflection of the death of the West (massive deflation) than it is a statement about Asia.

Asia was primarily an exporter to the West. This collapse will ween Asia of that role and set it up to lead the world as a consumer and producing for its own constituency. The West needs to die as a consumer in order for that transition to occur.

Don't be fooled.

[Erdogan]

The Chinese are gearing up for something. First it was the "correction" on the stock markets and then they partnered up with the BRICS countries to create their own little circle of friends and now they are

devaluating the Yuan. It's as if they are preparing for a strategic move in the economic market. I would be worried if I was in debt to them at this moment. 

Do anyone else see this pattern or am I delusional? Break the economy and win the war before it started?   

It not a strategic move, it is not to make their exports more cheap. It is firefighting, they are dead scared of the price movements in equity and housing. It is panic.

[deisik]

The Chinese are gearing up for something. First it was the "correction" on the stock markets and then they partnered up with the BRICS countries to create their own little circle of friends and now they are

devaluating the Yuan. It's as if they are preparing for a strategic move in the economic market. I would be worried if I was in debt to them at this moment. 

Do anyone else see this pattern or am I delusional? Break the economy and win the war before it started?   

I guess they would sooner break their neck. It may look as if they are up to something when essentially they may be just desperate in their efforts to save their own economy from collapsing...

Deep inside I never believed in China's economic miracle

I read today that Argentina (one of the countries they were signing deals with) has 1/3 of their foreign reserves denominated in Yuan, so this devaluation is hurting those who partnered on the Yuan as a reserve currency diversification (at least in the short-term but remember Armstrong's model is the $USD will peak 2017.9 or 2020.05).

Asia's economic miracle is still in place, because their debt is only at the corporate or LGO level and not unfunded social welfare liabilities to the tune of for example $125 trillion the USA owes the boomers. The West is demographically bankrupt, Asia is demographically fertile.

The population of Americas are 95 to 99% of European origin. Thereby the failing demographics can be remedied by sucking valuable human resources from outside (the pick of the basket). Isn't that exactly what the US has been doing the last 150 years? Is anything going to change? I guess many Asians would be happy to leave for the US if they were given such an opportunity...

A better life is only a world away

[johnyj]

Someone is shorting yuan like Soros did to HongKong dollar during 97, the pressure is so high that they must give up some ground. Usually the operation is not a single one, but a combination of different positions in stock index future and major stocks, maybe even commodities

[Erdogan]

Someone is shorting yuan like Soros did to HongKong dollar during 97, the pressure is so high that they must give up some ground. Usually the operation is not a single one, but a combination of different positions in stock index future and major stocks, maybe even commodities

It could totally fall (don't know if it will), just as any other fiat. The system is highly unstable.

[deisik]

The population of Americas are 95 to 99% of European origin.

You are way off :

Race / Ethnicity   Percentage of  U.S. population
Non-Hispanic White   63.7 %
Non-Hispanic Black or African American   12.2 %
Non-Hispanic Asian   4.7 %
Non-Hispanic American Indian or Alaska Native   0.7 %
Non-Hispanic Native Hawaiian or other Pacific Islander   0.2 %
Non-Hispanic some other race   0.2 %
Non-Hispanic two or more races   1.9 %
Hispanic or Latino   16.4 %
Total   308,745,538   100.0%

It may surprise you but the Americas are not just the US. Furthermore, I guess you may want to find out what Hispanics actually means (since you are evidently pasting data without second thought). And I may not tell you that what you call Black or African American are halfway the progeny of Negro slaves and white slave owners...

A whopping 35 percent of all African-American men descend from a white male ancestor who fathered a mulatto child sometime in the slavery era, most probably from rape or coerced sexuality. In other words, if we tested the DNA of all of the black men in the NBA, for instance, just over one-third descend from a white second or third great-grandfather

In any case, the European ancestry is heavily dominant across the continents

[Insertion]

The Chinese are gearing up for something. First it was the "correction" on the stock markets and then they partnered up with the BRICS countries to create their own little circle of friends and now they are

devaluating the Yuan. It's as if they are preparing for a strategic move in the economic market. I would be worried if I was in debt to them at this moment. 

Do anyone else see this pattern or am I delusional? Break the economy and win the war before it started?   

It not a strategic move, it is not to make their exports more cheap. It is firefighting, they are dead scared of the price movements in equity and housing. It is panic.

They know they are in deep trouble so they are trying their best keep the economy moving up. In last couple of days the yuan decline in value by about 4 percent against the US dollar. In 2008 chinese government was intervening in the market to make its currency artificially cheap to give advantages to chinese exporters but now US economy is strong & the chinese economy is weak so china doesn't have to intervene to make its currency cheaper. Market forces itself pushing the yuan down. It is all cheating game.

[MinerHQ]

Chinese knows now their economy is not in a good shape so by reducing their currency want to give benefits for their exporters

[lottery248]

in asian currency, only the HKD (my local currency, apparently) will be the top of them, since that was pegged to US dollars.
i hate china, their policy of economy is no good, they just wish to gain the advantage from the economy, or incorrectly rescuing the economy.
i now have to keep my HKD in my wallet, stay at home, and do not go any far away. luckily bitcoin isn't affected, especially the banks in china are forbidden to apply bitcoin for.

[BTC_ISTANBUL]

Someone is shorting yuan like Soros did to HongKong dollar during 97, the pressure is so high that they must give up some ground. Usually the operation is not a single one, but a combination of different positions in stock index future and major stocks, maybe even commodities

Dear friend only Chinese goverment is devaluating.Nobody is shorting Yuan.USA,Germany and others are willing Yuan to gain power over EURO and USD so they can perform foreign trade directly to China or to countries China export.

China and Hongkong are very different in volume.Neither the richest individuals nor the goverments can affect Yuan in long and medium term.However, China has a significiant affect on USD and EURO.

I am not a chinese.I am an European citizen trying to objective.

[bitcollins85]

the Yuan is already hugely undervalued, so another 1.9% is hardly what moved the market. I think the fact that they devalued is a signal to the market that things in China are more serious than they are letting be known.

[BTC_ISTANBUL]

The economists define two digit economical growth as normal for chinese economy.The new normal is 6 to 8 percent yearly growth. The Chinese economy has grown enormously for the last two decades.It was a continuous growth without any correction.Chinese bureucrats trying to give sport to chinese exporting companies by undervalueing Yuan. Do you think USA, Japan and Germany will accept this situation?In my opinion, no.

Chinese devaluation has political effects besides financial effects.

[tabnloz]

The Chinese are gearing up for something. First it was the "correction" on the stock markets and then they partnered up with the BRICS countries to create their own little circle of friends and now they are

devaluating the Yuan. It's as if they are preparing for a strategic move in the economic market. I would be worried if I was in debt to them at this moment.  

Do anyone else see this pattern or am I delusional? Break the economy and win the war before it started?  

I guess they would sooner break their neck. It may look as if they are up to something when essentially they may be just desperate in their efforts to save their own economy from collapsing...

Deep inside I never believed in China's economic miracle

I read today that Argentina (one of the countries they were signing deals with) has 1/3 of their foreign reserves denominated in Yuan, so this devaluation is hurting those who partnered on the Yuan as a reserve currency diversification (at least in the short-term but remember Armstrong's model is the $USD will peak 2017.9 or 2020.05).

Asia's economic miracle is still in place, because their debt is only at the corporate or LGO level and not unfunded social welfare liabilities to the tune of for example $125 trillion the USA owes the boomers. The West is demographically bankrupt, Asia is demographically fertile.

This Minsky moment correction for Asia will be completed by 2020 and Asia will lead up in growth while the wheels fall off the West from 2020 forward until Singapore and Shanghai replace New York and London as the financial capitals of the world by 2032.

The Yuan devaluation is more of a reflection of the death of the West (massive deflation) than it is a statement about Asia.

Asia was primarily an exporter to the West. This collapse will ween Asia of that role and set it up to lead the world as a consumer and producing for its own constituency. The West needs to die as a consumer in order for that transition to occur.

Don't be fooled.

The thing I wonder about China, and the rest of Asia, is that their economies have been geared to providing goods for the West, a market which has dwindled post 2008. It doesn't seem like it is coming back, so how can / do they transition to a consumer led, domestic consumption society in such a relatively short amount of time (considering deflation seems to be accelerating). They have created vast amounts of infrastructure, ghost cities, gambling meccas and have also had a large run up in property and their stock market. If global deflation continues surely that cannot bode well for stocks & property, and if sovereign debt defaults occur in Europe, Asia or Latin America, will any the traditional markets of any country be safe?

[countryfree]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

[MinerHQ]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

It is not gained 5% but European companies lost 5% if they have fixed their price in Chinese currency. They need to do more business to compensate this loss or increase their price

[tabnloz]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

While luxury products have been a booming market for the last few years, it looks like car sales are on the decline

http://wolfstreet.com/2015/08/14/china-mess-yuan-devaluation-dropping-auto-sales-spread-to-the-us-gm-ford-chrysler-component-makers/

[Erdogan]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

Eventually, all imported goods must be paid for with exported goods. The money can not change that. Devaluation changes the environment for the exporters, and the individuals working in the exporting industries. To the importers, the effect is opposite. The importers, and the individual consumers buying that imports, will lose. Completing the picture: The consumers of imports are the same individuals as the producers of exports.

There should be no devaluations, because it is just redistribution, increasing the risk of business because the devaluations are random, as seen from the view of the entrepreneur.

It could be fixed with sound money, but it can't, because the state depends on continously devaluing money for its own existence. It means the currency wars will go on, and nobody see the cliff, nor want to see it.

[deisik]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

Eventually, all imported goods must be paid for with exported goods. The money can not change that. Devaluation changes the environment for the exporters, and the individuals working in the exporting industries. To the importers, the effect is opposite. The importers, and the individual consumers buying that imports, will lose. Completing the picture: The consumers of imports are the same individuals as the producers of exports.

Unless you export debt. Now Yuan is cheaper (with respect to dollar), China will export more goods to the US. Thereby the US will export even more debt to China (closely watch the dynamics of the US government debt held by China). And everyone is happy...

It also works the other way round

[Erdogan]

It's a double-edged sword. The more China devalues its currency, the better for its economy, and the worse for the other countries. Most people only sees the Chinese exports, but many European companies are selling luxury products in China. Expensive German cars or French handbags. All those products' prices gained 5% this single week.

Eventually, all imported goods must be paid for with exported goods. The money can not change that. Devaluation changes the environment for the exporters, and the individuals working in the exporting industries. To the importers, the effect is opposite. The importers, and the individual consumers buying that imports, will lose. Completing the picture: The consumers of imports are the same individuals as the producers of exports.

Unless you export debt. Now Yuan is cheaper (with respect to dollar), China will export more goods to the US. Thereby the US will export even more debt to China (closely watch the dynamics of the US government debt held by China). And everyone is happy...

It also works the other way round

That is right, depending on perceptions (trust) by the seller of goods, he can take debt and the buyers money instead of goods for a good while. But when the money volume expands enough, and the debt gets too high, that perception changes, and the value of both the money and the debt goes down. The holders of debt and foreign money loses, and thereafter the buyers must offer real value (the crucial eventually word I used).

[Erdogan]

By the way, I saw this article on zerohegde by Eugen Bohm-Bawerk, explaining i detail what happens when payments in goods are delayed by debt:

http://www.zerohedge.com/news/2015-08-15/americas-economic-reset-will-trigger-global-recession-new-crises