Friday, August 27, 2010

China Blocks US-UK Attack On Euro

"...The Anglo-American hedge fund attack, as we have documented here, employed credit default swaps as the primary weapon against Greek, Portuguese, and Spanish government bonds. The failure of London and New York to induce a panic flight out of the euro during the May-June timeframe was partly results of the German self-defense measures, involving bans on naked credit default swaps and bans on naked shorting of German equities. In addition to this, Chinese support for the euro has played a decisive role.

There is every indication that the Chinese made a decision not to allow the destruction of the euro during the late spring and early summer. That decision was technical, commercial, and political at the same time. The technical part was the China sought to re-balance the basket of currencies it uses to maintain the international stability of the renminbi. As the euro looms larger in Chinese trade, purchases of euros and Eurobonds are in order..."

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