China Unpegs Yuan

Yuan Unpegged - 072105

China drops yuan-dollar peg, to price vs. basket : "The Chinese government on Thursday announced its long-awaited reform of its currency, saying it's dropping its yuan-dollar peg in favor of one vs. a basket of currencies. The government also lifted the value of the currency by more than 2%.

'The People's Bank of China will make adjustment of the renminbi exchange rate band when necessary according to market development as well as the economic and financial situation. The renminbi exchange rate will be more flexible based on market condition with reference to a basket of currencies,' it said.

China said it's adjusting the exchange rate to 8.11 yuan per dollar; overnight, the dollar traded at 8.2765 yuan overnight.

The move gave a boost to Asian currencies, with the Japanese yen soaring 1.7% against the dollar. One dollar was last worth 110.89 yen.

The Korean won appreciated 0.9% against its U.S. counterpart.

The daily trading price of the dollar vs. the yuan will continue to be allowed to float within a band of 0.3%, while the trading prices of non-U.S. dollar currencies will be allowed to move in yet-to-be announced bands, it said in a statement released on its Web site.

The Bush administration and the U.S. Congress have long complained that an artificially low yuan has boosted Chinese exports."

Best Comment on Judge Roberts So Far

Forget the NYT's pre-written snide remarks and the preety good Washington Post piece and all the email I'm getting, I liked this the best Instapundit.com: "The Insta-Daughter's take: 'He looks pretty good for 50.'"
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I'll give you my opinion on Roberts after I do my homework on him. Me liking the above might have something to do with my own mid-40's...No of course not.

Remembering Srebrenica

SREBRENICA, BOSNIA - HERZEGOVINA - JULY 11: The 610 coffins of the Srebrenica massacre victims are seen prior to the funeral attended by their family members at the Srebrenica Memorial site during the 10th anniversary of the Srebrenica Massacre on July 11, 2005 in Srebrenica, Bosnia Herzegovina. Srebrenica marked the 10th anniversary of the massacre with a massive funeral of about 610 victims who were identified after being exhumed and who will be buried at the memorial site. Some 8,000 Muslims, mostly boys and men, were slaughtered at Srebrenica in July 1995 by Bosnian Serb soldiers who had overrun the eastern town. The killings, in what was then a U.N.-protected zone, came shortly before the end of the country's 1992-95 war. (Photo by Marco Di Lauro/Getty Images)

Please click and read the article from Richard Holbrooke as he shows clarity, honesty and bi-partisanship, all of which we could use more of in these days - Was Bosnia Worth It?: "If you wonder whether the 1995 American intervention in Bosnia was the right decision, go to a really horrible place, one whose name has become synonymous with genocide and Western failure. Go to Srebrenica."
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Read it all, please.

FX Speculators: Yuan Boat Ready to Float

Yuan Headed for Controlled Float

China's Currency May Float a Little: "Sixty percent of China's state economists think the government should allow the country's currency to increase in value sometime this year, according to a survey compiled Monday by the National Bureau of Statistics.
The survey of 60 economists -- an internal study confirmed by two participants -- reinforced a growing consensus that sometime this summer China will adjust slightly upward the value of its currency, the renminbi, also known as the yuan, which has been pegged at about 8.28 to the dollar for about a decade.

...Predicting a Chinese currency move has become a perilous if popular game, with some of the world's largest investment banks making bold forecasts of imminent moves in recent months only to see the old regime prevail. The last such outbreak came in May, when some predicted China would use a national holiday week to try to sneak in a change, assuming that markets would be relatively quiet.

In recent weeks, anticipation has been building anew, with many predicting that a move will come sometime in August, ahead of a visit to Washington by President Hu Jintao in September."
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I wish I could play in this game....

America's Drug Laws Are So Wrong

Tierney today with Punishing Pain : "...Mr. Paey is merely the most outrageous example of the problem as he contemplates spending the rest of his life on a three-inch foam mattress on a steel prison bed. He told me he tried not to do anything to aggravate his condition because going to the emergency room required an excruciating four-hour trip sitting in a wheelchair with his arms and legs in chains.

The odd thing, he said, is that he's actually getting better medication than he did at the time of his arrest because the State of Florida is now supplying him with a morphine pump, which gives him more pain relief than the pills that triggered so much suspicion. The illogic struck him as utterly normal.

'We've become mad in our pursuit of drug-law violations,' he said. 'Generations to come will look back and scarcely believe what we've done to sick people.' "