re: Breaking: Trump/U.S. Labels China a Currency Manipulator..... Let's do this!!!

quote:

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The domestic Chinese debt that is denominated in yuan doesn’t need USD reserves

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I figured out the disconnect here. I'm talking about foreign dollar denominated debt. They can't just unpeg the dollar and let the USD/CNY run up like crazy. They do not have the reserves to pay down their foreign debt if the Yuan depreciates too much, and it's more likely than not they have multiples more off-balance sheet than what they report (I think it's close to $1T). The likelihood that this happens is pretty slim but it's a massive risk for them. On top of that is the risk of capital flight.

This is why I brought up their actions in Hong Kong because it's strictly related to prevent capital flight through force. They are related, I didn't say there currencies were the same lol I think a currency crisis in that part of the world is important to note when it's those two countries. If Hong Kong citizens can be extradidted on fake crimes back to China, then there will be capital flight out of both countries.