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Banks Back Switch to Renminbi for Trade

Submitted by northstar on Thu, 08/26/2010 - 20:44

Economy

A number of the world’s biggest banks have launched international roadshows promoting the use of the renminbi to corporate customers instead of the dollar for trade deals with China.

HSBC, which recently moved its chief executive from London to Hong Kong, and Standard Chartered, are offering discounted transaction fees and other financial incentives to companies that choose to settle trade in the Chinese currency.

“We’re now capable of doing renminbi settlement in many parts of the world,” said Chris Lewis, HSBC’s head of trade for greater China. “All the other major international banks are frantically trying to do the same thing.”

HSBC and StanChart are among a slew of global banks – including Citigroup and JPMorgan – holding roadshows across Asia, Europe and the US to promote the renminbi to companies.

More at:
http://www.ft.com/cms/s/0/182a2b70-b130-11df-b899-00144feabd...

Thank you Drudge for the tip.
http://www.drudgereport.com

Anyway you slice it the

Submitted by Charles Wilson on Sat, 08/28/2010 - 19:39. Permalink

Anyway you slice it the dollar is in trouble. Confucius was no dummy. Those Chinese are smart people whether we like it or not. I may be wrong but it seems to me that China is the "Lender of Last Resort" and the Unites States is the "Joe Main Street" who has unlimited credit on his charge card -- at least until the US is so far in debt we can't see the light of day. Once China has enough green backs to buy up all of our strategic assets, look out, the phrase "Mi Casa Es Su Casa" will soon have a whole new meaning.

How will this affect Walmart?

Submitted by mcchinsy on Fri, 08/27/2010 - 09:05. Permalink

We need to know, because America's job growth depends on Walmart.

And so it begins...

Submitted by samadamscw on Fri, 08/27/2010 - 01:18. Permalink

...

Bye, Bye Miss American Pie

Submitted by wauhoo on Thu, 08/26/2010 - 23:21. Permalink

Our "Death Spiral" just accelerated.

I don't trust the RMB because

Submitted by Velveeta Underground on Thu, 08/26/2010 - 23:02. Permalink

I don't trust the RMB because I don't trust the Chinese government. Say what you will, but I'd rather own euros before RMB.

—

Support freedom and liberty candidates in 2012... Ron Paul... Gary Johnson...

Pffft

Submitted by Achilles on Thu, 08/26/2010 - 23:40. Permalink

Euro? it'll fold under pressure much faster than the RMB ever would. Way too many skittish economies in the Eurozone.

I'm in China. Sure, it may be a bubble economy but it's not a debt backed bubble economy, to my knowledge.

to my knowledge, if it is backed by the "means of production"

Submitted by HVACTech on Thu, 08/26/2010 - 23:54. Permalink

it is not "bubble" based.
depending on how you define "capital" of course...

—

The primary function of the design engineer is to make things difficult for the fabricator and impossible for the serviceman.

You are correct.

Submitted by Achilles on Fri, 08/27/2010 - 00:17. Permalink

The Chinese may be dumb but they aren't stupid. In some very obvious ways they have followed the Keynesian model but in other ways they have not. This all started with the 'means of production' - Chinese manufacturing - allowing the Chinese to acquired lots of dollars in trade with the West.

Some of those dollars have been lent back to the U.S, foolishly or not. Others have been directed by the powers that be (not necessarily private interests) into massive public works projects: roads, bridges, dams, wind farms, high speed and conventional passenger rail lines, rail stations, airports and all are at or above Western standards. Then there are other projects - massive amounts of apartment complexes, commercial high rises and shopping centers.

It has the look and feel of Keynesian economics and you might believe the Chinese have bought into it, but the reality is that the size of the problem is so large here that there was almost no way to bring the up level of this country to modern standards, and improve the standard of living of the largest possible slice of the population in a relatively short period of time, without some sort of managed effort, coming out of a Communist model. The political inertia against a truly free market model was simply too great that it almost surely could never have happened.

This doesn't mean that this country will have to stay suckled on the government teat forever, though. Let's hope they're reading Mises, Rothbard, Hayek, etc. as well as Keynes in the Universities here, and learning the way off the path of socialism.