Federal Reserve Watch

[NYBob]

China inoculates itself against dollar collapse
By W Joseph Stroupe

There is mounting evidence that China’s central bank is
undertaking the process of divesting itself of longer-dated
US Treasuries in favor of shorter-dated ones.

There is also mounting evidence that China’s increasingly
energetic new campaign of capitalizing on the global crisis
by making resource buys across the globe may be
(1) helping its central bank to decrease exposure to
the dollar, while
(2) simultaneously positioning China to make much greater
profit on its investment of its reserves into hard assets
whose prices are now greatly beaten down, while
(3) also affording it greatly increased control of strategic
resources and the geopolitical clout that goes with it.
This is turning out to be a win-win-win situation for China
as it capitalizes upon the important opportunities afforded
it by the present global crisis.

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