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Nouriel Roubini's Bullish on the Chinese Yuan: Think Twice Before Buying It in ETF Form

If these are bonds, why do they pay 0% interest? Are the expenses for these ETFs so high that any interest is canceled out?

Strong RMB, Yen Not Good for the World

sidney: The paragraphs you wrote are similar to the words written in the book “The Japan That Can Say No.” Oddly enough, the appreciating yen has increased Japan’s government debt, in dollar terms, from $8.5 trillion to $9.2 trillion; in yen it’s approximately ¥850 trillion. If Japan’s debt increases by ¥50 trillion and the yen rises to ¥85 per dollar, they’ll regain the dubious distinction of being the world’s most indebted country — and will cement their place as most indebted per capita.

I use Japan as a recent example of how an export-centric economy utilizes its foreign currency reserves as collateral for issuing debt. This is in conjunction with depreciating the currency. Depreciation of China’s currency was actually part of Deng Xiaoping’s economic plan; off the top of my head, I believe the yuan was devalued from $0.52 to $0.12. The United States did this in the 1930’s (from 0.05 oz. t. gold to 0.024 oz. t. gold), Japan did this in the 1990’s (from $0.0139 to $0.0069), and China will more than likely do this (again) in the 2010’s.

Also, sidney, I wouldn’t give the World Trade Organization too much credit. China collects taxes by levying high tariffs on imports — a no-no for most WTO members. It’s China, not the WTO, that you should be blaming.

Chinese, Indian Currency ETNs Launch

Okay, we all know Morgan Stanley can buy yuan, but with the super–restricted yuan exchange, how could they sell it? It appears that the yuan ETN depends on black–market yuan buyers to be worth something other than an amount of yuan.