The Chinese are kidding themselves that they are international players.
Dopey's last post gave the clue where the future is going in our region.The Chinese honey moon is over and as soon as we get off this short sighted mantra of China being a so called world wide economic power house (that means has the maturity and prowess of international market competition)the better we will be.
Ask yourself,DO we really need China? based on the besotted belief that they are economically savey internationally?.
For what my opinion is worth I see China as a spoilt big fat only child that is clueless to the real market movements let alone not in my back yard syndrome it has.
International reserve currency[edit]
Currency restrictions regarding renminbi denominated bank deposits and financial products were greatly liberalized in July, 2010.In 2010 renminbi denominated bonds were reported to have been purchased by Malaysia's central bank[ and that McDonald's had issued renminbi denominated corporate bonds through Standard Chartered Bank of Hong Kong. Such liberalization allows the yuan to look more attractive as it can be held with higher return on investment yields, whereas previously that yield was virtually none. Nevertheless, some national banks such as Bank of Thailand (BOT) have expressed a serious concern about RMB since BOT cannot substitute the depreciated US Dollars in the 200 billion dollar Foreign Exchange Reserves held by BOT with Renminbi Yuan as much as BOT wishes because: 1.The Chinese Government has not taken the full responsibilities and commitments on the economic affairs at the global levels. 2.Renminbi Yuan still has not become well-liquidated (fully convertible) yet. 3.The Chinese government still lacks deep and wide vision about how to perform fund-raising to handle international loans at global levels.
However HSBC expects the Renminbi to become the third major reserve currency in 2011.
Countries that are left-leaning in the political spectrum have also begun to use the Renminbi as an alternative reserve currency to the United States dollar; the Chilean central bank reported in 2011 to have US$91 million worth of Renminbi in reserves, and the president of the central bank of Venezuela, Nelson Merentes, made statements in favour of the Renminbi following the announcement of reserve withdrawals from Europe and the United States
