Given China's massive influence on the world commodities markets, one has to wonder if they have hedged their future exposure through commodity forward contracts. Being the cynical person that I am, I would not at all be surprised if we learned the following over the course of the next year:
- China locked in significant commodities exposure in industrial metals prior to the announcement of their $580B stimulus package through shell companies that transferred this exposure to the Chinese government via its sovereign wealth fund
- China is slowly and furtively selling off US Treasuries in order to fund the purchase of these USD denominated commodities
- China has been purchasing precious metals in the market to hedge against USD value declines so that they are less exposed to the impact of their massive USD exposure
- Singapore has figured this out and is moving to get ahead of this trade
While I don't think China created this worldwide economic recession, they are probably taking advantage of it.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment