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The China Powerplay

Just read this on Marketwatch.

I posed this concept a while back on bloomberg.  See here.

I wondered "aloud" about China pulling a power-play by hedging their exposure to the dollar using commodities and other hard assets.  Frankly, I'm not sure what would happen to the Treasury market should China seriously consider this course of any case, I doubt this would occur right now.  

The current situation is the financial equivalent of "Mutually Assured Destruction" (MAD).  This is the financial Cold War indeed.  

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