Thursday, July 9, 2015

Chinese Currency Crisis?

The stock market in China has taken a terrible nosedive over the last couple of months and was down 30% the last I hear. The Chinese government is determined, if one can believe the reporting, to get the stock market going up again. It appears they have encouraged their citizens to invest in stocks and many are looking to retire on the stock gains. (Sound familiar?)
If the stock market, any market, is artificially inflated then the currency used to value the securities is deflated. That was the first thought.
Second thought. The Chinese have a cultural affinity for gold. And even priced in US dollars increased demand would benefit the gold producers.
Enough said. I've been wrong on that one for quite awhile....

control risk,

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