89.2 China Warns World of (Next?) Dollar Disorder
———Ep 89.2 Summary———
The People’s Bank of China lowers its bank Required Reserve Ratio to get money into a slowing economy. A lowered RRR means that there aren’t enough (euro)dollars flowing into China. Why? Because there aren’t enough (euro)dollars in the world. A lower RRR is a warning for the whole world.
———Ep 89.2 Topics———
02:31 China has lowered its required reserve ratio (RRR)
03:34 What is the mainstream interpretation of a lower Chinese RRR?
04:12 How does the RRR work in managing the inflow of “hot money” (eurodollars)?
08:10 A lowered-RRR has served as international warning of escalating global monetary disorder.
11:34 The RRR cut is an early warning indicator (like in 2018) that contradicts reflation.
14:19 In 2021 the mainstream narrative is for reflation… but China just issued a warning.
———Ep 89.2 References———
How Do You Spell Escalating? C-H-I-N-A-R-R-R: https://bit.ly/3kzlOmS
A Practical History of Financial Markets: https://www.didaskoeducation.
Alhambra Investments Blog: https://bit.ly/2VIC2wW
RealClear Markets Essays: https://bit.ly/38tL5a7
Jeff Snider, Head of Global Investment Research for Alhambra Investments and Emil Kalinowski. Art by David Parkins.