It's raining fish in the Northern Territory

However, the total Hu's visit will undoubtedly reach a series of agreements, but the ultimate effect of these agreements can save big variable. If the U.S. does not compromise to the Chinese strategy, these agreements may not be effective; or Europe to China throws better conditions, these agreements may not be effective; again, or that China is still in the process to maintain the balance of Europe, derive greater strategic interests are also possibilities. However, China's Hu visited the United States date to determine the total monetary policy in China after the big move on their own is undoubtedly a great adventure. Once monetary policy tightening cycle, reversal must pay a heavy price. If Europe is entering the final attracted the interest rate cycle, it is a major victory. I personally think that Europe should enter the interest rate cycle conditions are likely to use the funds to China for the debt crisis in Europe a degree of security. So we get out early policy of continuous rate hikes, with uncertainty to the uncertainty of Bo, which is obviously a great adventure.

In addition, liquidity in China, China will have a policy of devaluation risk to leave them. The sudden devaluation of the RMB half or more, completely out of China who want to trap the capital. This prerequisite is that China's economy to its close up. Of course, maybe not to this point, it is possible to obtain a compromise strategy in Europe and America. However, the final out in the absence pending the outcome of aggressive monetary policy to carry out attacks in Europe and America, the strategy is clearly at great risk.

So, why this strategy is at great risk? Great risk is that the rate hike will undoubtedly strengthen the last rate hike in China's interest rate increase this time to enter the interest rate cycle, making China the possibility of more than Qi Cheng, if ultimately forced to make another rate hike, then the percentage enter the interest rate cycle of one hundred. And enter the interest rate cycle, to adjust monetary policy to pay back the cost of that would be great. So, if the interest rate received a better response in Europe and America, if not available, then the Chinese really have to do to close up the economy prepared. So, if China do to let the whole world to prepare a hard landing, well prepared to cope with war, then make such a strategy is not necessarily a bad strategy, but it must be an adventure. And if you get a response in Europe and America, then China rate hike is worth it, China can increase the rift between Europe and America and Europe to accelerate the pace of China's compromise (compromise is the largest in Europe and close to China's monetary policy, the largest U.S. compromise transfer to China is a big strategic interests, at least to put the yuan from East Asia, Southeast Asia, out). This is China's strategy is obviously beneficial. Mr. Hu's visit there nearly a month, this month we can observe the reaction of European and American parties.

China with Russia at that time to sell U.S. bonds, it is extremely detrimental to China's behavior, how could China be brought Westerner acting as a proxy? For China, not to keen to take the initiative and the United States to engage in confrontation, but should still maintain a strategic defensive, while advancing the field in the accelerated advance to increase their strength. If the dollar standard drained what China and the Chinese assigned to the cost is not proportional, and that China would continue as the dollar-based system linger. For the EU-Russia, China in overturned on the dollar standard is not pressing them, so if the Russia-EU cooperation should both sell to the Chinese strategic interests Caixing. For the United States the most serious threat against the U.S. dollar is not the yuan but the euro. In this context, China stands out when not necessary, but should be strategizing, continue to use the United States and Europe, the conflict between the United States and Russia to achieve the maximization of their own strategic interests.

Second, the gap between China and Russia held large dollar assets, China more than two trillion U.S. dollars, Russia, hundreds of billions of dollars. Russia and the United States to dry, to go to Russia, China spearheaded it? This is clearly not in China's strategic interests. Moreover, once China with the United States would not immediately point the finger at Russia, but to point to China, because China holds dollar-denominated assets larger, more direct pressure on the United States.

Sixth, the Russian dry Georgia, United States is bound by suppressing the price of crude oil to suppress the Russian economy, which relies heavily on China's external energy of this country's economy is good, can significantly reduce the operation of the Chinese economy costs.

third, claims to sell the dollar, the U.S. economy will directly lead to chaos, the Chinese economy was still very dependent on the U.S. market, the economic chaos that the U.S. economy will be chaotic China, which China did not benefit.

So, why is the strategic interest rate risk rather than the big mistakes? We also need a bit of elaboration, because here is not to say China's rate hike will have no victory. China rate hike, the objective will be to accelerate the four Russian-US-EU showdown time, the showdown is bound to stand and take sides. China to raise interest rates in advance to release the other direction is a confident signal. But this confidence in itself is extremely risky. To this point more clearly, we need to start from the last interest rate suddenly talking about.

First of all, if not participate in the European Union, China and Russia can not overthrow the dollar standard.

, we refute those who have to raise interest rates to control inflation logic. In this regard, a simple interpretation. Interest rates, this will no doubt attract hot money. U.S. interest rate now stands at 11 times (U.S. discount rate of 0.25%, China 2.75% interest rate), spreads directly reduce the risk of hot money will cost, improve margins, which may not be how to attract more inflow of hot money? Did not see that every month in the fourth quarter to add hundreds of billions of new foreign exchange? Therefore, interest rates will undoubtedly increase the speed and scale of hot money inflows, the central bank monetary policy which will increase the difficulty of hedging, currency in circulation will increase, not only in the early inflationary pressures can not be suppressed but will accelerate inflation. So much hot money, China's currency is still not as world currency, will inevitably increase the pressure of RMB appreciation, China's ability to control the exchange rate stability is being challenged, then once the rapid appreciation will lead to commodities accelerated. This in turn led directly to the pressure of imported inflation to further increase. In interest rates to control inflation and RMB appreciation of Western economic theory of induced vulgar, this policy will enter a dead end, and that is ultimately significant appreciation, interest rates sharply higher, but at this time because our interest rates have sharply increased, the real economy has been suppressed, but it was asthma. To this time, inflation seems under control, but the real economy problems will begin to raise interest rates make China completely sealed, at a time when the Fed began to enter the interest rate cycle, the dollar is expected to start, a lot of money starting from within the Chinese economy withdrawal into the U.S. economy, China's monetary system and economic system will collapse instantly, the outflow of funds will make a lot of enterprises have closed down tide, a large number of unemployed people wave, sharp currency depreciation, etc. will eventually make China's economy into deflation moment. The fact is that 1997 picture of the economic crisis in Southeast Asia.

for the entire world, the Korean Peninsula are not the core issue. The core of the problem? Iraq nuclear issue, the Middle East peace. China's recent issue of peace in the Middle East frequently offensive to the nuclear issue on the United Nations, the Arab world, Palestinians and Israelis stood on the side of the issue to the United States to launch an attack. This pressure, in relation to the United States have had an impact, there has been diplomatic spat. China in the Middle East, strategy is frequently score, the Middle East peace negotiating table from China is getting closer. In this direction, China's strategy is floating a lot of profit. China's strength, not wishful in any direction, the United States are now pressing the gourd dipper, how could that China's overall defensive Where can duck to water? The conflict in East Asia, China's loss what to eat? Diaoyu Islands in the past do not cruise, and now become a normal cruise. Korean Peninsula is not the meaning of development such as China, has so far not the meaning of development as the United States. Japan profitable yet? Appear to be, but in fact China has already started to discuss the academic community ownership of the Ryukyus, the future, once the U.S. withdraw from Asia, Japan may just not eat the Diaoyu Islands issue, but the entire Ryukyu independence and may re-take China to. The reason is simple, according to Okinawa after World War II agreement is not part of Japan, the legal flow, and subject to change due to the strength of the change. As for the four northern islands of Japan, China and Russia this time on the interaction makes the four northern islands Japan has suffered a major loss. Meanwhile, the Japanese economy is subject to China, once China to take revenge on the economy, Korea is the first goal. Japan has been any good? Instability in Northeast Asia, the United States temporarily benefit the most, but not the cost to the United States is small; Russia did not pay any cost but to enhance the control and the four northern islands of Japan to suppress; greater pressure on China in East Asia, but at least the issue of the Diaoyu Islands and tougher than ever to become a normal cruise, cruising range has begun to close the Ryukyus, in fact, the strength of the Pacific range is extended. Instability in Northeast Asia, the real disadvantage of the addition to the two countries on the peninsula as well as Japan. Japan is a strategic disadvantage, because the Democratic Party had the goal is to borrow on the strength of the United States out of China so that Japan's Ryukyu Islands to become a more normal number, larger autonomy (Hatoyama government's ambitious goals), but in the end not only did not but can drive out to strengthen the Japanese military alliance. Offend on the Diaoyu Islands in China, not only failed to Diaoyu Islands to swallow, but let the Chinese stepped up activities in this area, even greater pressure on the four northern islands. Not to mention the economy, the Japanese looked at life and life in China and other countries to strengthen their cooperation but no copies, in the direction of India and Pakistan put a $ 50 billion contract to fall into the quagmire of stagflation that Japan can not be envious? As for politics, the government of Japan Naoto Kan's support for only 20% more, has begun to split within the Democratic Party of Japan (Hatoyama another comeback, while another Democratic giant is suffering from donations scandal), the Japanese government may change at any time. This regime does not return to a stable, talk about strategy? The two countries on the Korean peninsula is the biggest damage, because North Korea already poor, already blocked by the United States continue to blockade does not matter, but trouble will trouble a point of support from China, South Korea is the biggest loser on the peninsula . Look at international politics, must be from a global perspective. In Northeast Asia, the United States did not get to get more Chinese in the Middle East.

From this point of the traffic rule and then go to Beijing blocking scheme, other policies might see the possibility of sexual orientation. Beijing auto sales month this year is estimated to reach 80,000, and next year to the 20,000 per month of grade, such a policy from the government point of view is clearly blocked somehow, we all know unworthy of the truth. Rule blocking the best solution is to charge Suddenly dropped from 80 000 20 000 If you do not see from a higher level is not read. Repairer with what? Steel. What is the burning car? Oil. What is the biggest bottleneck in China? Oil, iron ore and other resources. Part of the real economy of Europe is what is most important? Car. Imagine if China this program, by extension, the United States and Europe on international oil prices and the real economy is such a big hit? Of course, this is no doubt the Chinese automobile industry is a huge blow. But two evils choose the light, compared to the car or people eat is more important. So, if true to the duel, when China is likely to come up with such an administrative policy to deal with Europe, which does not violate WTO trade rules,Beats By Dr.Dre Tour, trade sanctions can play the same effect. Therefore, a separate program to see Beijing's rule blocking ridiculous, but if look at from another perspective, that is another plan. This signal from the car manufacturers will soon be there, and then transmitted to the European and American politicians, decision-makers in Europe and America, the same will be transmitted to those oil-producing countries.

the last round of interest rate, suddenly, there is no sign. That rate hike, to some extent is a political interest rates, it is released to the rest of the world China's political signal. This political signal that China could raise interest rates to slow economic growth, the Chinese economy closed up, big deal to make the world a hard landing. China is the real economy, the growth of domestic big deal at the same time, send money to the people, the economy can still turn up. Can Europe do? Implying the number of eating live virtual economy? This is a warning to Europe, do not annoy China. G20 summit final results prove that this political interest rates at least at the time for political purposes is achieved. However, this rate hike is also open China's rate hike cycle, but also attracted hot money, China has become more difficult to control inflationary pressures, the pressure of rising asset prices more difficult to control. Moreover, in the interest rate is expected to increase pressure on the case of a sudden, no doubt China's monetary policy will face even greater pressure. Therefore, the author's suggestion is for the pressure comes.

Fourth, to sell the dollar, the dollar depreciated asset prices higher, China's foreign dependence on significant resources, which is also not good for China.

this policy is a strategic offensive style play, the offensive is bound to take the risk. If the final release in Europe a good signal to China, then China can always Hu visited the United States to the United States a higher asking price; if the U.S. gives China a better price, you can come back to China and Europe in the negotiations (the total from Hu back to the United States, China and the EU will increase high-level contacts, which no doubt) to increase their asking price. Whether any of Europe and America, at least from China are not going to work, because this world can not find any so far in Europe and America can maintain economic operation of the real economy. Role for the dollar and the euro to challenge the United States wants to maintain the dollar's status, must control or cooperation with China can be achieved. Control, nothing more than the development of China through war, stuck in the throat, which is the United States most want to achieve and has been doing; cooperation, but ultimately control, the development of China is also stuck in the throat, which is Europe wants to achieve but because of the strength of put is a cooperative attitude, but did not release particularly large chips, which is the key to Europe has been unable to reach an agreement. The Chinese, of course, also use all this to achieve their strategic objectives. Therefore, the interest rate hike is still a political nature, is a key factor in China to test and throwing parties to exert pressure on a strategy.

critical moment in this strategy, any aggressive are likely to lead to defeat.

the central bank in the second time in two months time interest rates, individuals will be defined as a strategic adventure. There are comrades in arms said it should be a strategic mistake, but I need to say is not the final conclusion, any person not qualified to advance such a conclusion. Although this strategy adventure so far personally think that the odds have not seen too much, but so not in its place, not their government, can not say that policy is not expected to go their own say is wrong, this is a totally unacceptable subjective behavior. But viewpoint, it is necessary to uphold and support based. Therefore, the individual interest rate hike is still on the reservations, so the strategy will be defined as a big adventure. Here, on the interest rates and the possible impact of the future be a simple analysis.

there that the Olympic period, together with China, Russia to sell U.S. Treasury bonds. If China and Russia do with it is stupid to sell U.S. Treasury bonds. Most want to overthrow the U.S. dollar-based system is who? Russia. Clean up the Russian military in 2008 Georgia, this time to sell U.S. Treasuries and the dollar standard down together with China, or at least coordinate on the issue of Russia's military action in Georgia, the U.S. economy will not lead to repression in Russia. We might look at a few:

recent series of e-mail received by his comrades, saying that China is the tension in the Korean peninsula, the biggest loser. I only ask: Even if the Korean peninsula to play smashes, China has lost what? For China, South Korea will not be eaten as long as North Korea, North Korea is a natural strategic barrier. So, even if the Korean peninsula war, a war that is outside the country. As the Korean War, that is, keep the enemy outside the gates of a good war. Therefore, the unstable situation in the peninsula, must suffer the greatest people on the peninsula, is the two Koreas. Especially once the war, if the U.S. does not intervene, and that China will not intervene, but every family had a type of civil war. This disadvantage of China, of course, but not a big deal. If the United States entered the war, the Chinese also have the choice of war and not war. Because if China and Russia provided weapons support to North Korea to resist, eventually China will not war; the contrary, China is inevitable war. The Sino-US war, who can suffer who can take advantage of? A nuclear war? Basically impossible. Fight a conventional war? China so many missiles the United States, Japan, logistics you dare? If so, what lessons China can take the opportunity to Japan, China missile base will not allow a base in East Asia. If Japan can not become a U.S. logistics base, then how can the United States and China to fight a conventional war? Real fight, hundreds of thousands of U.S. troops in Afghanistan that the logistics how to do? China is not saying that hundreds of thousands of U.S. troops to eat? United States to strengthen US-Japan, US-ROK military alliance, mainly to contain China, then to force China into submission. Its purpose is not to engage in full-scale war with China. China and the U.S. political system is different, is the failure of the war can not afford, so once the decision to go to war will not be able to control the size of the United States. The United States know this, imagine that is why the fifties the United States can not win the Korean War? Because China is in desperate, but the U.S. is to fight the blood, completely different in nature. Afraid of hard-soft, hard not afraid of life, this is the law. To date, this has not been any fundamental change in nature, but China's military capability is improved a lot. Therefore, the Korean Peninsula to China did not benefit, but most suffer is not China. Of course, where the most benefit from the United States, but also the interests of the United States eat under a huge cost. Once the final hurdle as the top back by the Chinese, it can not rule out a direct consequence of the possible U.S. withdrawal from East Asia. Not the last, not on winning or losing. How China has become the biggest loser? I once said that if the final war is inevitable, then place the Korean peninsula very well, this may be under the direction of China in Pakistan key to a big bet one of the reasons. To put it plainly, is to do the preparation for a showdown on the Korean peninsula.

G20 summit in China's aggressive interest rate policy, this time is no different. Received results last time, this time is still unknown. But the attack is bound to surprising flaws, so in the end whether the European concessions in China is very important. Of course, China wants a showdown, if Europe does not give that to them also have a huge risk, because China can continue to put economic growth to reduce the posture. China is determined to take this move, probably spotted this.

So, I have emphasized many times that China should not raise interest rates at this time, because interest rates to control inflation at this stage is not only useless, but will accelerate inflation. On the contrary, the central bank should cut interest rates twice and increased the deposit reserve rate hike expectations way destroyed. At the same time, it should consider other means to stabilize prices at the same time, as by controlling the production means to the European exporting inflation (specifically addressing the reference December 11 blog post, Mr. Skin backwater This strategy can actually let the Chinese currency relative to maintain a defensive strategy, which can temporarily withstand the defensive pressure, while on the road to nationalization of the RMB and then go far faster pace. So, for China, but think back to take real steps, followed by more conducive to policy adjustments.

interest rates again this time was unexpected, to faster than expected. This is Hu's visit is always a great relationship, which is also a political interest rates, the release of same outward political signal. First, the release signal to the United States, China could reduce economic growth by raising interest rates, not with the United States, big deal everyone a hard landing. This hike, in the political decision-making on the United States have an enormous pressure. This time because China can make concessions to Europe, the Chinese real economy, virtual economy and Europe's butt, along with the EU-Russia get rid of dollar standard. From a practical effect, the three Central European Russia work together as long as the dollar-based system will soon end, but as a result the world will face a re-shuffle, the shuffle process may be a big war. Second, the release signal to Europe, if Europe is asking too much, and indecisive, and worry about the outcome, China and the United States is entirely possible to reach further agreement with the economic benefits for the actual U.S. strategic interests in Europe's strategic interests. Third, the release signal to Russia, no matter what China has adopted a strategy of Russia only Russian side of the Chinese side better fishes. Moves from Russia on (immediately raise the deposit reserve ratio), the Chinese side of the side but did not follow China's policy (not to raise interest rates).

fifth, selling U.S. debt, dollar price drop, China is so big dollar assets will directly damage the euro is now high time that China sold the U.S. dollar can only buy the euro, will continue to push high euro, which is based on both sides of the loss may not be measured in one hundred billion U.S. dollars but trillions of dollars to measure.