is the death of the u.s. dollar imminent, page-9

I think we need to not just concentrate on what the US are doing but also need to keep our eyes on what is happening in China. Hugh Hendry has some intelligent and interesting stuff to say (albeit not a gold buyer atm and some of the stuff I completely disagree with) but worth a listen to and read.

Here are some facts and figures to get started though from Gnazzo.

http://www.marketoracle.co.uk/Article12153.html

China Surging Money Supply a Strong Driver for Inflation and Commodities
Commodities / CRB Index Jul 20, 2009 - 02:10 AM

By: Douglas_V._Gnazzo

Commodities

Diamond Rated - Best Financial Markets Analysis ArticleHonest Money Gold & Silver Report - According to the data published by the People's Bank of China on July 15, the broad money supply (M2) expanded more than 2 trillion Yuan in June alone, to 56.89 trillion Yuan. That’s an increase of 7.28 trillion so far this year (14.6%) and a year on year increase of 28%.

For all the jawboning China does about the United States over-issuance of money, they’re not doing too bad themselves. The Chinese money supply is rising at its fastest pace in more than 12 years, and foreign-exchange reserves have gained the most since the global financial crisis began.

As if that were not enough, China’s 5-Year Government Bond yields are near 2.8%. At the beginning of the year they were approximately 1.6%. This is the highest level since 2007, but it is important to note that rates reached over 4.5% during 2007, so they have retraced less than about 28.8% of their decline – less than the first Fibonacci retracement level. Nevertheless, interest rates are on the rise and perhaps significantly so.

This is worth keeping an eye on. If Chinese rates continue to rise it could impact not only the dollar, but the price of commodities as well. China has been a recent big buyer of commodities, especially metals. Higher rates could put pressure on the dollar, in turn causing commodity prices to rise. At this point this is only speculation, but it bears watching............cont'd