Originally posted by snaw
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It has little to do with the innate value of the Chinese currency. The huge elephant in the room is that the Chinese, thanks to unbelievably stupid economic policies but the US government over the last 15-20 years, basically own the dollar.
One of the many factors that makes predicting what is going to happen with the world economy over the next five years nigh on impossible is that nobody knows how the Chinese will use that weapon. And rest assured, a weapon it is. They may choose to support the dollar, they may not.
Personally, I think the outcome of G20 gives an indication of what Chinese economic policy is. They want to use their financial muscle to influence getting the dollar replaced as the world's backup currency, thereby reducing US influence across the globe. They are not stupid these Chinese fellows.
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