By Doug Noland at The Credit Bubble Bulletin
I figured I would surprise readers this week and focus on China. There’s been a lot written and spoken this past week. My challenge is to put Chinese devaluation into perspective and offer unique insight.
August 12 – CNBC (Fred Imbert): “China’s decision to depreciate the yuan was presented (albeit surprisingly) to the world as a way to bolster a recently floundering economy, but Art Cashin said… that Wall Street remains concerned… ‘What’s scary here is that people are beginning to doubt the sophistication of the Chinese officials… Whether they are adept enough and clever enough to know where to move; they didn’t look very adept when they were trying to save their stock market, and they’re in an area where it can be a little dangerous…”
As they say, “bull markets create genius.” Let me suggest that Bubbles deserve Credit for propagating “genius” – genius in the markets, throughout the real economy and in policymaking. I recall how the brilliant, omniscient and clairvoyant “Maestro” Alan Greenspan was unconditionally revered during the late-nineties Bubble period.
Bursting Bubbles leave a mess – in the markets, throughout the real economy, in societies, in politics and with policymaking. Major