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According to a somewhat bizarre report on Informa Global this morning, the U.S. and China have...

According to a somewhat bizarre report on Informa Global this morning, the U.S. and China have reached an agreement on yuan appreciation in exchange for the U.S. holding off on QE2.
Comments (26)
  • if that's true, one could probably not be too short
    14 Oct 2010, 06:39 AM Reply Like
  • This has to be nonsense. Unless the US is thinking very long term. Unlikely. It will be interesting to see what comes of this story.
    14 Oct 2010, 06:44 AM Reply Like
  • pretty big story with NO confirmation I can find at this hour. Too bad SA isn't documenting this a bit better.
    14 Oct 2010, 06:48 AM Reply Like
  • I wish we could document it better too. The rumor came via a subscription-only newswire service and we can't link to anything behind their paywall.


    I've been looking around online and don't see any confirmation elsewhere yet. Has anyone here seen anything about it?


    In the meantime, I wanted to get the post up because it's interesting, if nothing else, though I agree with the comments here that the story seems pretty farfetched...
    14 Oct 2010, 06:57 AM Reply Like
  • Thanks. It is a headline maker. Thanks for clarifying.
    14 Oct 2010, 07:16 AM Reply Like
  • If, by chance, the rumor does turn out to be true, I'd bet bick bucks that the confirmation won't come out until after the elections and that our Administration will either not bother to address the rumor or categorically deny it.
    15 Oct 2010, 03:53 PM Reply Like
  • mark, from today's development of postponing the report (after the election / so things can be worked out / because it says no manip....), this is appearing more and more likely.


    A nice compromise with China on the yuan, less than robust QE by the Fed, China agrees to continue buying $XXX of treasuries .... ?
    15 Oct 2010, 04:05 PM Reply Like
  • today's follow from yesterday. you guys are publishing pure rumour at this point. and i would remind you, the fed, is not part of the us government or the treasury department for that matter, if the suggestion is, the treasury is using QE as a bargaining tool with china on currency levels.


    1:08 PM Some political theater looks put off - for now - as the Treasury reportedly delays its currency-practices report until after the G-20 summit on Nov. 11 (and, coincidentally, after the elections). The semiannual report, legally bound to come on April 15 and Oct. 15, is delayed for the second time this year amid rumors of deals with China relating to yuan valuation and possible limits to quantitative easing. 7 Comments


    where is this substantiated???? "amid rumors of deals with China relating to yuan valuation and possible limits to quantitative easing"


    other than what SA published yesterday, which is also unsubstantiated:


    Thursday, October 14, 6:18 AM According to a somewhat bizarre report on Informa Global this morning, the U.S. and China have reached an agreement on yuan appreciation in exchange for the U.S. holding off on QE2.


    both of these items have huge market moving implications, and yet, are published w/o any concrete evidence of any kind.


    please clarify!
    15 Oct 2010, 05:37 PM Reply Like
  • I'll wait till I see a pig flying before I jump on this one.
    14 Oct 2010, 06:51 AM Reply Like
  • get ready gold bug if this is true
    14 Oct 2010, 06:56 AM Reply Like
  • Did you see what gold and silver did overnight?
    14 Oct 2010, 07:55 AM Reply Like
  • if its true, sell some
    14 Oct 2010, 08:09 AM Reply Like
  • what would be in this for China????
    QE will probably push the prices of their US treasury holdings up. And most of their holding are less than 10 years.
    14 Oct 2010, 07:11 AM Reply Like
  • What is in it for China? One would be lower commodity prices. Another would be their products would remain affordable to American consumers.


    Possible benefits for the US would be to see China continue to buy our debt.


    The story sounds too good to be true. It would be nice to think that the Federal Reserve finally grew a collective brain.
    14 Oct 2010, 07:54 AM Reply Like
  • The market is riding high on the promise for QE. It is hard to believe that anybody in the administration is brave enough to risk an even temporary but very significant slump in the financial markets here and now, right before the elections, for what can be only a promise for a long-term, relatively slow appreciation of the yuan. Not that such move is impossible. Just the odds are pretty low.
    14 Oct 2010, 07:29 AM Reply Like
  • You mean like blowing up the story on foreclosures?
    14 Oct 2010, 07:41 AM Reply Like
  • the admin seems to be trying to tamp down the foreclosure mess. the concern is being stoked by the 40 attorneys general.


    14 Oct 2010, 08:11 AM Reply Like
  • QE2 is virtually a done deal ... you take that away and in my opinion you CRUSH investor confidence, given the parade of fed presidents/governors calling for it.
    14 Oct 2010, 07:42 AM Reply Like
  • QE2 is a virtual lock right now... if they Fed backed away from it due to a last minute agreement with China, investor confidence would be CRUSHED ... given the parade of presidents/gov's that have been pounding the table on this. This is so far fetched to me Im surprised it was even posted.
    14 Oct 2010, 07:45 AM Reply Like
  • Chance are that you are right but I am thinking the Fed folks may be starting to have second thoughts. I don't know if they may be starting to think that it will be difficult for the US public to afford the higher food and energy prices that most certainly will accompany QE2. I think the chances for wage increases to cover the higher prices are not there. Right now we have a liquidity bubble - way too much cash sitting around earning almost nothing. QE2 will only make that worse and for the US to proceed without China's blessings would be futile.
    14 Oct 2010, 08:10 AM Reply Like
  • Bernanke (Summers/Geitner) is playing high-stakes poker with the Chinese. QE2 is the hand he's holding, but the Chinese don't know how many aces he's holding (i.e. how big the QE2 will be). Other US trading partners are taking the pain of the dollar rise for long term gain of the QE2 bluff paying off. This was probably all worked out at the B-berg Group meeting in Spain months ago, where exchange rates were a primary topic of conversation. What's in it for Chinese? The commodities they buy priced in $$$ get cheaper, and protectionist legislation is forestalled in Congress.
    14 Oct 2010, 08:29 AM Reply Like
  • "the pain of the dollar rise"
    the dollar is dropping, not rising - right?
    14 Oct 2010, 08:36 AM Reply Like
  • USD/CAD now 0.9989...wowza!
    14 Oct 2010, 08:33 AM Reply Like
  • hey, its hockey season!
    14 Oct 2010, 08:36 AM Reply Like
  • Give it people. The Chinese will allow their currency to appreciate only when THEY think it is in their best interest. No matter what they say.
    14 Oct 2010, 09:00 AM Reply Like
  • The rumor seems to be gaining a bit of traction...especially with the St. Louis Fed's statement that QE2 would be useless to damaging.
    14 Oct 2010, 10:17 AM Reply Like
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