China taking steps to get rid of US Dollars

China has looked at what the Obamanation is doing to the dollar and is doing what any rational player would and should do; get out of the currency and into hard assets.

Once major holders start fleeing a currency, interest rates for debt denominated in that currency will rise. The US Government will quickly have to increase interest rates, choking private investment, reducing tax revenues and increasing deficits.

That seems to be our short term fate under "O-shit!"

Obama is an economic illiterate waddling down a path to national ruin, gosling Democrats in tow, some tighter to his ass than others.

It is not any one program, it is all of them, all based on a premise of infantile hope and heading towards disastrous change.

The next election cycle cannot come fast enough.

Hopefully by then Michael Jackson will be buried and there will still be some public buildings and roads not named after the Lion of the Senate.

With a little luck, the hapless Republicans, peckers stowed, will have rehabilitated themselves and some moderation can be restored.




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Aug 26, 2009, 11:19 p.m. EST
China wealth-fund chief tips buying spree

LOS ANGELES (MarketWatch) -- The president of China's well-financed sovereign wealth fund said his group plans a massive, ten-fold expansion of its overseas investment this year, according to reported comments from an interview Thursday.

China Investment Corp. President Gao Xiqing said the fund's foreign holdings will go from $4.8 billion last year to "several tens of billion dollars," Reuters reported, citing Gao's interview with Japan's Asahi newspaper.

Gao was quoted as saying CIC held about 90% of its management funds in cash or similarly liquid forms at the end of last year, but that this will change now that financial markets are no longer in a state of crisis.

Among possible new investments under consideration are Japanese companies and property, given prospects for a recovery in that country's economy, Gao said.

Reuters also cited unnamed sources from an earlier report as saying CIC plans to invest up to $2 billion in U.S. mortgages.

The Wall Street Journal has also reported recently that CIC has selected Morgan Stanley (MS 29.46, -0.07, -0.24%) and Blackstone Group LP (BX 13.21, +0.11, +0.84%) to oversee hundreds of millions of dollars in new investments.

Earlier this month, Chinese state media reported the CIC's first-ever annual financial statement, which showed a 2.1% loss for its global investment portfolio.

Past Time to Rescue the Dollar.

Bear Stearns collapsed in less than a week. Oil and gold will be followed by any other commodity or hard asset as investors panic to conserve capital and flee a falling dollar. Gresham's Law dictates that good money drives out bad and if something is not done fast, we will be closing in on a dangerous flash point. Act!

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Ailing dollar plunges to new low against euro



TOKYO (AFP) —

The dollar plunged to a new record low against the euro and stayed at a 12-year low against the yen in early Asian trading on Monday amid deepening worries over the US economy, traders said.

The euro hit 1.5737-40 dollars in early trading shortly after 7:00 am (2200 GMT), the highest level since it was created in 1999, before easing to 1.5687 dollars later.
The dollar also fell to 98.02 yen in early trading, down from 99.18 yen in New York. It was trading at 99.01 yen in Tokyo Monday morning.

The dollar fell as worries over the US economy have deepened, said Kenichi Yumoto, vice president at the foreign exchange sales and trading department of Societe Generale in Tokyo.

"It's all about Bear Stearns," he said, referring to news Friday of an emergency loan to prop up the crisis-hit Wall Street investment bank.

The fact that US regulators intervened to drag the bank from the brink of collapse highlighted worries over the health of US financial companies, he said.
Company officials said Sunday Bear Stearns would be bought by J.P. Morgan Chase for two dollars a share.

But Yumoto said the dollar's renewed plunge may come to a halt in Asia after a new round of selling runs its course.

Don't Worry, It is Only Our Currency.

Oil at $84 a barrel. The dollar at $1.40 to a Euro. Russia has $420B in currency reserves and Americans have a 0% saving rate and are buying heavy Chinese at WalMart. The world saves and we spend. We shall see.

US dollar plunges to new lows
By James Quinn in New York and Emma Thelwell in London Telegraph
Last Updated: 3:22am BST 21/09/2007

The US dollar plunged to fresh lows against global currencies as investors flee the greenback amid signs that this week's 0.5pc rate cut by the Federal Reserve will not be its last.

The dollar fell to its lowest level against the euro since the currency's inception, breaking through the $1.40 barrier, as Fed chairman Ben Bernanke raised expectations that a further cut is on the cards.

Against the euro, the greenback almost hit $1.41 at one stage, while the Canadian dollar hit parity with its American counterpart for the first time in 31 years.

Sterling was up 0.45pc at $2.0093. Analysts expect the dollar to weaken further against the euro. Barclays Capital's Paul Robinson warned it could slide to $1.42 by the end of the year, possibly even hitting $1.45.

The Daily Telegraph's report that Saudi Arabia is preparing to break its dollar-peg intensified the woes, as did the rising price of oil, which surged through the $83-a-barrel mark as oil companies closed down facilities in the Gulf of Mexico.

In New York, US crude was up $1.44 at $83.37 by mid-afternoon, while in London, Brent crude rose 40c to $78.87.

Investors headed to the gold markets, with the yellow metal jumping its highest in 27 years, touching $746.50 at one stage in New York.