Nice Bet China

[tippy]

Some currency gamesmanship going on here. China says they are diversifying out of dollars and into Euros. Does anyone really believe they would come out and say this publicly? Like saying I've got 72 offsuit and I'm putting you all in. Just not believable.

If you held dollars, you wouldn't attack the currency pushing it to all time lows. And you wouldn't praise the Euro pushing it to all time highs if you really wanted to buy it.

You would however make this statement if you wanted to dump your Euros at the top and buy dollars at the bottom.

I'm giving the long dollar trade another try at 1.47. With gold hitting 850 and oil near 100, there is inflation mounting. I still think rates are going to have to go up soon, which should benefit the dollar. At the least, rates shouldn't go down, even given the credit problems.