Friday, March 13, 2009

US Dollar Collapse: Wen Voices Concern Over China's U.S. Treasuries DXY, HUI, XAU, GDX, SLW, RMK.v, TNR.v, OK.v, SBB.v, RR.v, GBN.v, MGN,

Our yesterday Crash Alert on US Dollar is getting more sense now with Chinese worried about their investment in US corp debt. Now FED can push US dollar down and blame Chinese for evil doing continuing to talk about strong dollar.
BEIJING – Chinese Premier Wen Jiabao expressed concern over the outlook for the U.S. government debt China holds, urging Washington to take effective policies to restore the American economy to health. He also said China can do more to boost its economy if that becomes necessary.
Speaking at his annual press conference, Mr. Wen voiced confidence in the Chinese government's ability to keep its own economy growing, and said it has the resources to roll out additional stimulus measures if needed.
"We have reserved adequate ammunition. We can at any time introduce new stimulus policies," he said.
Mr. Wen reaffirmed that China can meet its traditional target of economic growth of around 8%. He said market expectations last week of another stimulus package were based on "rumors and misunderstandings," and that China's existing four trillion yuan investment program addresses "both short term and long term needs."
Premier Wen Jiabao, at his annual press conference marking the close of China's legislative session, spoke forcefully about the effect of China's policies on the global economy.

But he noted that the U.S. remains the world's largest economy, and said that China is closely watching the effects of policies taken by U.S. President Barack Obama.
"We have lent a huge amount of money to the U.S., so of course we are concerned about the safety of our assets. I do in fact have some worries," Mr. Wen said in response to a question. He called on the U.S. to "maintain its credibility, honor its commitments and guarantee the safety of Chinese assets."
China holds the world's largest foreign-exchange reserves, reported at $1.946 trillion at the end of 2008, and about two-thirds of that sum is believed to be held in U.S. dollar assets, primarily Treasury bonds. Mr. Wen repeated China's position that the foreign reserves are managed with a view to "safety, liquidity and profitability" – in that order. He said that while China's first priority is to protect its own interests, it will "at the same time also take international financial stability into consideration, because the two are inter-related."
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