
Chinese Yuan’s Ascent to Global Reserve Status: A Timeline - eth0up
https://www.bloomberg.com/news/articles/2016-09-29/the-chinese-yuan-s-march-to-global-reserve-status-a-timeline
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ting_bu_dung
This is pretty much a non-event. China's more likely to suffer hyperinflation
first, than become a currency that other countries use/store.

1.) Yuan is being printed massively (it hit a credit-to-gdp ratio of 30 to 1
[http://www.bbc.com/news/business-37403363](http://www.bbc.com/news/business-37403363))

2.) it is a non-fully-convertible currency

3.) there are severe restrictions for yuan to move out of the country due to
capital controls. max $50/year. also, $15k/year withdraw restrictions
([http://money.cnn.com/2015/09/30/news/china-overseas-atm-
cash...](http://money.cnn.com/2015/09/30/news/china-overseas-atm-cash-
limits/))

4.) no one is required to use yuan for trade.

5.) nobody wants yuan outside China. people in China are desperate to exchange
yuan for other things inside China. All the conditions are there for
hyperinflation to occur. Might happen early next year when europe and China
both likely reject China's market economy status, and starts imposing tariff
on Chinese imports heavily.

~~~
fspeech
This is basically a copy and paste of your previous post
[https://news.ycombinator.com/threads?id=ting_bu_dung](https://news.ycombinator.com/threads?id=ting_bu_dung)
without even bothering to correct the most glaring error pointed out by
others. I say this is pretty disrespectful to users who are interested in real
discussions.

~~~
ting_bu_dung
my last comment didn't get any good response; one wanted a clarification which
was easily googleable. the other one about hyperinflation being supply driven
made no sense (incorrect definition of hyperinflation), so I didn't bother
responding.

how about you? do you have any response about the content, or is it more meta-
critique?

~~~
fspeech
"europe and China both likely reject China's market economy status"

Did you even read what you posted? The above does not make any sense and you
repeated it here without any correction anyway.

Googling or not you don't seem to realize that China is not currently
recognized as a market economy by both Europe and US per China's WTO accession
agreement. That particular clause is going to sunset this year. After the
sunset if Europe and US follow the WTO rules they will no longer be able to
use "substitute country" in determining fair prices in anti-dumping
investigations. This is a positive for China. Even if Europe and US refuse to
change it is still just status quo, or in your words, "non-event".

The other commenter's critique on your hyperinflation claim is entirely valid.
Calling him incorrect without giving your "correct" definition does not make
it so.

Also self-plagiarism is a thing. Sure this is only an internet forum but
unless you are hell bent on propaganda please refrain from copying yourself
verbatim without at least making a reference to your previous posts so people
don't waste time repeatedly refuting your identical claims.

------
rtpg
My impression up until recently is that actually holding onto Yuan outside of
China is near-impossible, is this no longer the case?

~~~
neximo64
Not yet, but eventually that is supposed to be the goal.

~~~
mgkimsal
the goal is supposed to be holding yuan outside china is impossible? or
possible?

------
fitzwatermellow
More from the Working Group on USD Yuan trading:

[https://www.rmbusawg.com/](https://www.rmbusawg.com/)

Bit of a Catch-22. Can't invest directly in Chinese markets until the Yuan is
convertible. And closed markets affect the Yuan's stability. But foreign
demand, it's in the trillions:

China’s debt markets start to stir foreign appetite

[https://www.ft.com/content/7c6708f6-8627-11e6-8897-2359a58ac...](https://www.ft.com/content/7c6708f6-8627-11e6-8897-2359a58ac7a5)

------
Aldo_MX
Ok, this is really interesting, the Yuan (CNY) has officially become one of
the 5 mayor reserve currencies (USD, EUR, CNY, JPY & GBP), since the IMF added
it to the SDR basket today.

The following month will be the American elections and I expect the Brexit
effect to repeat with the US Dollar after the result gets announced, since the
average Joe will certainly vote for the candidate who proposed the less
global-friendly economic policies.

Will the Yuan have a chance to benefit from the post-election speculative
chaos?

~~~
Kenji
Both the Brexit effect and the speculative chaos you propose are very short
term. The fluctuations do not correspond in any way to the performance of the
state and economy backing these currencies. Therefore, I think that if it
benefits CNY, then only for a short timespan. However, if the US really
tightens the screws on international trade, it will suffer longterm and so
will its currency.

(And yes, I find the prospect of closed markets, increased tariffs and the
like dreadful. There is no reason for the US to do that. This is different
from Brexit though, since the EU conditions free movement of people and huge
bodies of law on the trade agreements. A post-Brexit Britain may have more
free trade than ever before since it can do its own agreements with any
country - like any sovereign nation should.)

~~~
tonyedgecombe
I don't see British trade expanding post brexit, we will almost certainly
loose a substantial portion of our financial services and over time car
manufacturing, the only trade likely to increase is tourism.

------
epx
And the Chinese know better and are buying real estate in Canada.

~~~
personjerry
The Chinese are also buying a ton of real estate in China. It just happens
that a lot of Chinese have immigrated to Canada, especially Vancouver, and so
tell their relatives about the place, and many of them have fairly wealthy
relatives who are all too eager to snatch up the rapidly rising real estate.

~~~
neximo64
Its also just recycling their trade deficit back in. It is infact Canadian
funds being used to buy those homes, the savings which came from the excess of
imports to Canada to exports to China. A solution to the structural issue is
to export more to China so there aren't so many savings stored in real estate.

~~~
pooper
Whenever Canadians complain about Chinese speculation in real estate, I wonder
why they don't try to create more inventory. It is probably naive to think
this way but AFAIK Canada has a lot of land and a housing boom can help extend
and modernize urban infrastructure.

~~~
kogepathic
> I wonder why they don't try to create more inventory.

They can't exactly conjure up more undeveloped land in the middle of
Vancouver, Toronto, or Montreal.

> AFAIK Canada has a lot of land

Yeah, where almost no one wants to live. 90% of the Canadian population lives
within 100km of the US-Canada border.

If you ask people abroad about major Canadian cities, everyone knows of
Vancouver and Toronto. Some people also mention Montreal and Ottawa, but after
that very few people can name other cities (e.g. Calgary, Quebec City,
Winnipeg)

> and a housing boom

Many people are now warning that Canada has a housing bubble. Given the
country's history of policies, I wouldn't trust them to handle it well. The
mortgage and banking industry are not as powerful as they are in America, but
they have influence.

I grew up in Canada but am currently living abroad, so I get to talk to a lot
of foreigners on their opinion/knowledge of Canada.

