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"The US economy is undoubtedly in recession. Many parts of industry are actually in a state worse than recession. If it were not for [Fed governor] Bernanke injecting huge amounts of money, the stock market would probably be down much more than it is," he said.

I hate currency-traders who short the dollar, then find someone in the MSM who helps them trash the U.S. economy.

"then find someone in the MSM who helps them trash the U.S. economy"

Our old friend Ambrose "Graft" Goldbug Evans-Pritchard.

yitbos

I hate currency-traders who short the dollar, then find someone in the MSM who helps them trash the U.S. economy.

But this sh!t sells papers and attracts viewers: it is really no different than watching Entertainment Tonight in order to see the latest celebrity gossip. But while the story is the same the difference is the key players.

What gets glossed over is this story is this:

The euro has risen 18pc against the yuan over two years.

Look, here's the deal. China, like most economically-backward thinkers, has a 'make work bias'. They would rather go full bore on their production at the expense of their current consumption. China, with it's loose currency peg to the USD, could purchase and import a lot more stuff than they do right now if they wanted to un-peg. But China is in a unique position since it has steadily liberalized its markets and given its population more freedoms and a better standard of living that what they had before the liberalization. As more and more young Chinese leave the rural farms and seek work, the central planners have got to satisfy and accommodate, especially since agricultural production is actually increasing even as young people are leaving the farm.

Believe it or not, it's when people like Rodgers [in this story] buy Yuan denominated assets that's when China will have to start incrementally shifting toward a more balanced economic approach. The flip side of all this is that when (or if) China sees (or is forced to notice it through actions like those of Rodgers) the wisdom of foreigners -- foreigners to the Chinese -- buying their assets, they will also start noticing the capital inflows. these inflows will be used for investment, business expansion, and increased equity...the only question which will remain is who, exactly, will own this equity in China! But, can you imagine what the protectionist will say when these days do come (if they come): "Why are you buying China's stuff (their assets) and helping the ChiCom economy?" And we'll be there to remind the protectionists that, "Hey, at least the trade deficit is shrinking (or has disappeared)! Aren't you happy?"