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House China vote on Wed key to watch

Posted By Peter Boockvar On September 27, 2010 @ 8:39 am In MacroNotes | Comments Disabled

The tug of war between a lackluster economic recovery on one side and the Fed’s printing press on the other and its influence on stock market action will get another influence this week and again, its Washington, DC abetted. On Wednesday, the House is expected to vote on the Currency Reform for Fair Trade Act, aka, punish China for pegging their currency to the US$, notwithstanding that other countries do the same and even though China’s export figures are inflated because they only add a small amount to the finished product exported. I don’t know what the appetite of this bill is in the Senate to see whether it gains any traction past the House but any possibility of passage would be a disaster for our relations with China in my opinion. Moody’s downgraded the unguaranteed debt of Anglo Irish ahead of this week’s release of more details of the cost of its bailout. Straight out of the movie ‘Groundhog Day,’ Japan wants another stimulus package.

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