Short-Term Key: Neutral
Long-Term Key: -6 (Neutral)
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Inside this week's update...
***** China floats the yuan.
***** Quantitative easing and commodity prices.
***** Where technology research dollars should be spent.
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The big news this past weekend was China's decision to let its currency, the yuan, trade with more “flexibility” - in other words, higher. As you know, we've been expecting such a move for some time, but with more dread than optimism. Nonetheless, this slight change is no reason to panic.
True, our long-term opinion on the yuan remains unchanged. A freely floating yuan means a higher yuan and (for Americans) it means higher prices for all commodities, especially gold.
The case is straightforward. A higher yuan will make commodities more affordable for China.
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