In The News Today

Some good stuff from Jim Sinclair below that you should pay attention to. Just looking at the markets today, the DJIA is down, the USDX isn’t dropping, but gold and silver prices are climbing. This has not been the norm lately and tells me that things are shifting in the underpinnings of the finance sector.

In The News Today

Dear Friends,

The euro is under pressure due to the liabilities of their states. The US dollar will come under severe pressure for the same reason.

Gold has NO LIABILITIES attached to it and has been a currency since the beginning of written history.

Regards,
Jim

 

CIGA Eric’s Commentary

There he goes with hat in hand.

Geithner to visit Beijing amid currency dispute
US Treasury Secretary Geithner to visit Beijing, suggesting ties better amid currency dispute
Aijaz Ansari, Associated Press Writer, On Wednesday April 7, 2010, 7:42 am EDT

MUMBAI, India (AP) — U.S. Treasury Secretary Timothy Geithner will visit Beijing for talks with a Chinese vice premier for economic affairs on Thursday, Geithner’s spokesman said, in a sign the two sides are moving toward settling a dispute over China’s currency controls.

Geithner will meet with Vice Premier Wang Qishan, spokesman Andrew Williams said Wednesday, as the Treasury secretary ended a two-day visit to India.

"The secretary and the vice premier have been working together to find an opportunity to meet for some time," Williams told reporters in Mumbai, the Indian financial capital.

Williams gave no details of the agenda, but the decision to hold such a high-level encounter suggested Washington and Beijing are moving toward settling the currency dispute, which has threatened to overshadow cooperation on the global economy, Iran’s nuclear program and other issues.

Washington and other Chinese trading partners are pressing Beijing to ease exchange rate controls that they say keep its yuan undervalued, giving China’s exporters an unfair price advantage and swelling its multibillion-dollar trade surplus. Some American lawmakers want punitive tariffs on Chinese imports if Beijing fails to act.

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Jim Sinclair’s Commentary

Never try to out negotiate the Chinese. If you do you might get the surprise of your life.

This administration will not accomplish what the past two failed on by force or a coalition formation.

See what you can do, if anything, and do it. That is too complicated for the US financial government.

China Considers Yuan Trading Against Ruble, Won, Official Says
By Bloomberg News

April 7 (Bloomberg) — China is considering allowing the yuan to trade against the Russian ruble, South Korean won and Malaysian ringgit to promote its use in cross-border trade, an official at the China Foreign Exchange Trade System said.

The People’s Bank of China is investigating the possibility of offering new foreign-exchange pairs, said an official at the Shanghai-based interbank exchange, a subsidiary of the central bank. He asked not to be identified as authorities have yet to make a final decision. Traders now can buy or sell the yuan against the dollar, the euro, the Japanese yen, the Hong Kong dollar and the British pound.

“That would be a further step towards making the yuan an international currency,” said Liu Dongliang, a Shenzhen-based foreign-exchange analyst at China Merchants Bank Co., the country’s fifth-largest lender by market value. “The move would help foreign companies buy or sell the Chinese yuan at lower costs.”

China is seeking greater use of the yuan to reduce reliance on the U.S. dollar after Premier Wen Jiabao said last month he is “worried” about holdings of assets denominated in the greenback. From July, the government started allowing companies in Shanghai and four cities in the southern province of Guangdong to use yuan in cross-border trade with Hong Kong, Macau and members of the Association of Southeast Asian Nations.

President Barack Obama will keep pressing China to end the yuan’s 21-month-old peg to the U.S. dollar and likely will bring up the topic when he meets Chinese President Hu Jintao next week, spokesman Robert Gibbs said. Executives at Chinese banks have supported a stronger currency to allow it to play an increased role in global trade and to spur growth in financial markets.

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