Re: [PEN-L] gold and malaise

[Sandwichman]

Yeah, I'm thinking of the peg but not imagining that unpegging would "fix" it. Especially if part of the problem is that by pegging the RMB to the dollar it doesn't so much rescue the dollar as it does weaken the RMB itself. The US runs the printing presses and China underwrites the paper. It's still bad money. Sopping it up doesn't dry it out.

I started to a little leery when Stephen Roach was seeing rays of light. There's nothing like a tiny bit of improvement in a situation -- "dodging the bullet", so to speak -- for bringing on the breach in the levee. I'm just guessing that those top players who are tasked with buying shit to keep an orderly market are resting up tonight for a busy day tomorrow. It's a friday.

On 5/11/06, C Ruiz <[EMAIL PROTECTED]> wrote:

In a message dated 5/11/2006 7:40:32 P.M.  Eastern Daylight Time,
[EMAIL PROTECTED] writes:
foreign exchange  imbalances, that are being "contained" by state
intervention, to commodity  prices and then back to financial markets.


How are they being  "contained"  by the state? If you are thinking of the
Chinese peg, then an  un-pegging of the RMB would lead currency speculators to
shorten the dollar for  quick trading gains.

--
Sandwichman