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Yuan shot heard round the world but quiet in China
- pmjordan 16y agoForgive my ignorance, but what exactly stops the Yuan's value fluctuating based on market conditions? If the likes of George Soros can destabilise the GBP back in the day, what exactly keeps the Yuan stable? Does the Chinese government basically promise to indefinitely buy and sell Yuan at a fixed USD exchange rate?
- hga 16y agoPartly, but I think the biggest method is that the currency isn't freely traded, e.g. see the end of http://en.wikipedia.org/wiki/Renminbi#Managed_Float http://en.wikipedia.org/wiki/Renminbi#Managed_Float Individuals can only exchange $50,000 per year and $500 per day.
- elai 16y agoSo what do the wealthy hitting it large in china do?
- hga 16y agoIf they aren't part of the nomenklatura or otherwise have enough pull I'd assume deposit their money in a PRC bank, stock market or venture, etc. When there are currency controls you by definition don't have much in the way of out of country options.
- borisk 16y agoPeople's Bank of China will exchange practically unlimited amounts of Yuan to USDs for other banks in China.