News again! - Try pressuring China harder..

The limelight is not on China these days..
All the la~la~ on the US sub-prime mortgage market and the choking credit crunch that results, the dragon is indeed not directly involved in the all the hype and action..

But the bitter trade and currency disputes between US and China just never end. And China is indeed attempting to make her presence felt once again.

With the mounting pressures on China to revalue their yuan northwards for the sake of a fairer, happier trading environment, China is flexing its political and economical muscles. But it is not the first time anyway.

It all started with a mysterious China central bank official making remarks, hinting that China may toy with the thought of dumping the US$ should US push them too far with all the sanctions and weapons of protectionism.

Sitting on 1.33 trillion worth of USD denominated assets, China does have weights to throw around and the weights can very well crush the already weakened US$. Ouch~

But.. Will China really change her official policy and launch a trade retaliation?

Well, Bush thinks China would be “foolhardy” if they were to execute this thought they were toying with. China later calmed the public that they will support the greenback as it is a vital component of its reserves despite having plans to invest its reserves in other ways to earn higher yields.

Both the super powers can indeed play pressure-threaten-retaliate stunts in this trade war, but both parties are well aware that their intricate relationship not only went all the way back into history, witnessing milestones like Mao and Nixon shaking hands, but also plays an important role in shaping the world’s economic landscape. The stakes are simply too high for both powers to lose their cool and turn the table. A tricky issue like this is best solved in cordial way. *peace*

So.. Let’s focus our attention to the US sub prime mortgage ONCE AGAIN. Sentiments in the coming months will indeed be a cautious one and the real impact of the sub prime mortgage crisis is just becoming to unfold. Let the exuberance begin..

News posted on behalf of Techno Cat