Bank of China Brings Yuan Trading to the U.S. .

[Joanne98]

Source: WSJ

Bank of China Ltd., one of the country's four major state-owned banks, has opened trading in the Chinese currency to customers in the U.S., representing a symbolic endorsement by Beijing of foreign trading in the yuan.

The decision is the latest move by China to allow the yuan, whose value is still tightly controlled by the government, to become an international currency that can be used for trade and investment. Analysts say allowing trading in the yuan, also known as the renminbi, is an early step by the Chinese government toward making its currency fully convertible into dollars and other currencies.

"We're preparing for the day when renminbi becomes fully convertible," Li Xiaojing, general manager of Bank of China's New York branch, said in an interview with The Wall Street Journal. He said the bank's goal is to become "the renminbi clearing center in America."



Read more: http://online.wsj.com/article/SB10001424052748703791904576076082178393532.html

[Kolesar]

1. An unrec? eom

[Joanne98]

2. Some people unrec everything!

[westerebus]

3. And they are FDIC insured.

God you just got to love this country! :rofl:

[Po_d Mainiac]

4. Gresham's law

Gresham's law is commonly stated: "Bad money drives out good", but is more accurately stated: "Bad money drives out good if their exchange rate is set by law."

This law applies specifically when there are two forms of commodity money in circulation which are required by legal-tender laws to be accepted as having similar face values for economic transactions. The artificially overvalued money tends to drive an artificially undervalued money out of circulation <1> and is a consequence of price control.

Gresham's law is named after Sir Thomas Gresham (1519–1579), an English financier during the Tudor dynasty. However, the law had been stated forty years before by Nicolaus Copernicus, so in parts of central and eastern Europe it is known as the Copernicus Law. The phenomenon had been noted even earlier, in the 14th century, by Nicole Oresme. The fact of bad money being used in preference to good money is also noted by Aristophanes in his play The Frogs, which dates from around the end of the 5th century BC.

http://en.wikipedia.org/wiki/Gresham%27s_law

[Larry Ogg]

5. Nice law but...

What makes one money good and the other bad?

[Po_d Mainiac]

10. How many 1964 Kennedy 50 cent pieces have you seen lately? n/t

[westerebus]

11. I'm not tellin.

So there!

Besides, there's only one showing from the roll, the other ends got some old dumb tape on it.

[thaddeus_flowe]

6. interesting post

"the moment China, the oil-rich states, and other international investors stop buying U.S. Treasury Bonds, the dollar will become junk. Inflation will rocket upward. We will become Weimar Germany."
Snip
"Lenin said that the best way to destroy the capitalist system was to debauch its currency."

-Christ Hedges' Empire of Illusion

perhaps i should "diversify my portfolio" and invest in the People's Republic?

[On the Road]

7. If You Want to Invest in the Chinese Economy,

the best way to do it would be through an ETF like one of these.

Barring an economic meltdown, which is possible (China has its own debt issues), the yuan is probably as safe a long-term currency bet as there is. At some point there may be a big increase, but it could come gradually over the next ten years or be postponed indefinitely. The Chinese have been doing this song and dance for years and seem to want to hold out as long as possible.

[AlecBGreen]

8. I worked in China for a number of years and saved some RMB

I was paid @ 8.2 to the dollar and its now gotten to 6.6. A 24% rate of return in two years aint too shabby and I think in the near term it has nowhere to go but up.

[On the Road]

9. That's Great

the article mentioned the increase for 2010 was 3.3%, which sounded a little low. Provided the Chinese economy stays strong, and the Central government doesn't try to backtrack, there's no way it can go down in the long term.