The Yuan Manipulation Issue Is Going To Explode


There’s no way now that the matter of yuan manipulation doesn’t become a huge political issue in the US, especially as the clock ticks for Obama to create jobs.

You have to figure that after the November GOP landslide, Obama will feel he has a year or maybe less to produce major results so that he can somehow win re-election in 2012.

He has to start early playing the yuan card, putting max pressure on China to to let its currency strengthen against the dollar.

As Ian Talley at Dow Jones notes, the big yen intervention move only raises the stakes as it’s now clear that Japan is doing something about currency, leaving the US as the odd man out.

A key part of exporting your way to success — which the US is already losing — is to gain currency competitiveness, and everyone else is taking decisive action except the US.

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