Ufo propu engine, closed loop

[ltseung888]

http://orientaldaily.on.cc/cnt/finance/20170125/00273_001.html

The above Chinese Newspaper Article described the attack of the RMB by the Hedge Funds. It said that the Hedge Funds used "news" to spread gloom for China. The Foreign Exchange Reserve plummeted from 4 trillion to 3 trillion with no sign of stopping.

人民幣貶值趨勢既成，引發內地走資潮，人行不惜動用外匯儲備去減慢貶值速度，力圖挽回市場信心，可惜堆沙填海，治標不治本。去年十二月，中國外儲跌至三萬億美元邊緣，創近六年新低，較高位縮水近萬億美元。

中央穩信心效果不彰，反而因外儲消耗，惹來金融大鱷群起攻擊，並唱淡中國外匯儲備會跌至二萬六千億美元，隨時觸及警戒線。大鱷屢發這些言論，實際上是要借助市場力量，聚眾推牆，測試底線為名，向市場發放悲觀預期為實，推冧人民幣，從中獲利。

The Hedge funds spread rumors that RMB will depreciate while they mount their attack. What is the Bank of China doing?

To counter-attack such rumors, we can:
(1) Talk about super democracy. Talk about the limitations of electing representatives. Talk about how one party when getting power will change the policy of the other. (Trump on TPP and Obamacare is  good example.)
(2) Talk about how hedge funds forced UK to devalue its currency in 1992. Talk about the destruction of the Asian Financial Crisis in 1997.
(3) Talk about the disintegration of USSR and the rapid depreciation of its currency.
(4) Talk about Mutual Credits or Bilateral Agreements.
(5) Talk about Governments need to properly manage printing of thin-air money.
(6) Talk about the tactics used by the Crocodiles (Hedge Funds) in the currency war.
(7) Talk about how China can use RMB as the Settlement and Reserve Currency by pegging to the Dollar and making its use legal only in China. Control of the Currency and Foreign Currency Reserve are vital to the Economic Health of any Nation. Currency Exchange should be used to facilitate trade and travel - NOT to be used as weapons by Hedge Funds or Speculators.
(8) Talk about if a Nation wants to be rich and remain rich, it should help other Nations rich.
(9) Talk about the new competition of the two camps - help poor Nations develop.
(10) Talk about the new Globalization - no need to worry about border disputes now. All will be one family later.

[ltseung888]

Possible innovative policies of the New Chief Executive of Hong Kong.

A group of us had lunch gathering before the Chinese New Year of the Rooster. One of the hot topics in Hong Kong is the Election of the New Chief Executive. Many complained that the candidates did not propose anything innovative. Someone suggested that we should post our innovative ideas to them. The following are some quick thoughts:

(1)    The key theme should be the rebuilding of self-confidence and harmony of the Hong Kong Citizens.
(2)    On the economic front, help China to beat the Hedge Funds with the proposal similar to that used by Malaysia in the Asian Financial Crisis in 1997.
(3)    Expand the opportunities to the young people via the one-belt-one-road initiative. For example, there is no room for agriculture but there are excellent opportunities in Africa.
(4)    Hong Kong can develop the best on-line educational courses covering primary and secondary school courses. Such courses can be updated from time to time. Additional special courses can be added later. Encourage other Nations to use them.
(5)    Introduce Super Democracy so that every voter can vote on key issues as an ordinary event. Hong Kong will lead the World in modern democracy.
(6)    Have Mutual Credit Agreement with a few selected Nations. Post every detail on-line so that the World can learn together.
(7)    Solve the housing issue via cooperative expansion to Shenzhen and Zhuhai taking advantage of the Hong Kong-Zhuhai-Macau Bridge and the Science Park Zone near Shenzhen. Many businesses can be done on-line. Physical location is not an issue.
(8)  Adopt the Alibaba model and show that Company Branches or Franchises can be managed or monitored remotely.
Have special workshops to show that anyone can open his/her own shop. Any success will rebuild the self-confidence of the Hong Kong Citizens.

[ltseung888]

https://en.wikipedia.org/wiki/Internationalization_of_the_renminbi#RMB_as_a_reserve_currency.5B22.5D

Why was RMB not attacked in the Asian Financial Crisis?
RMB was not an International traded currency then.

Is the Internationalization of RMB a trap? Did some "advisors" tell the Chinese Authorities that RMB could become a Settlement and a Reserve Currency with the same benefits as the US Dollar? Did the Chinese Authorities fail to understand that opening up RMB Internationally means opening it up to attack? Did  the Chinese Economists fail to warn the Authorities that the FOREX trading is a form of gambling - one side bets the exchange rate will go up and the other side bets it will go down? If Speculators gang up on one side to force the exchange rate down, they will tilt the balance in their favor.

I will gamble if the odds are definitely in my favor. It is not really gambling. It is legally robbing money from the other side. When Hedge Funds gang up to push the RMB down, they will tilt the balance in their favor. They will win. The rumor they spread that RMB will devalue is self-fulfilling.

Looking back, it is a trap in the Currency or Economic War. China was doing well with the RMB pegged to the Dollar and "closed" Internationally. Economic War is fought with cunning. It is difficult to distinguish between friend and foe. The trusted advisor may actually be the worst enemy.

If China takes the Malaysian Approach, some will argue that China is going backwards. It will be a loss of face. To be realistic, China has already got one foot caught in the trap. (4 trillion USD reserve dwindled down to 3 trillion) It will be a painful process getting out from the trap. Losing a limb is to be expected. Failing to get out will mean sure death. (The USSR disintegration example should be clear.)


The Chinese RMB can still be a Settlement and Reserve Currency if it is firmly pegged to the Dollar and traded legally only in China. When other Nations are confident that RMB will not depreciate and may even slowly appreciate as in the early 2000s, they will keep RMB. I opened RMB account in Hong Kong for that reason.

[ltseung888]

https://en.wikipedia.org/wiki/Internationalization_of_the_renminbi#RMB_as_a_reserve_currency.5B22.5D


I will gamble if the odds are definitely in my favor. It is not really gambling. It is legally robbing money from the other side. When Hedge Funds gang up to push the RMB down, they will tilt the balance in their favor. They will win. The rumor they spread that RMB will devalue is self-fulfilling.

Looking back, it is a trap in the Currency or Economic War. China was doing well with the RMB pegged to the Dollar and "closed" Internationally. Economic War is fought with cunning. It is difficult to distinguish between friend and foe. The trusted advisor may actually be the worst enemy.

Tseung, are saying that Bank of China gambled foolishly and lost one Trillion USD?

[ltseung888]

Tseung, are saying that Bank of China gambled foolishly and lost one Trillion USD?

Yes. The advisors who advised RMB Internationalization in the present form are likely to be spies or Trojan Horses in the Economic War.
China must not continue struggling in the trap - draining the Reserve. Losing some face now is better than later when the Reserve dwindles to nothing.
FOREX exchange is worst than a Casino. It is unregulated, highly leveraged and unfair. Huge fortunes can be made or lost. (Hedge Funds are winning and China is losing big.)