Hey guys. Went to a Greatest and Best Ideas Conference. One of the panelist's greatest and best ideas for the next year was to short the yuan and go long the dollar. That is what I am doing. At first glance common sense will tell you to go long the yuan. After someone very intelligent disects the relationship, you soon realize that they are about to come down hard. For example. In the US, home prices are about 3.5x people's yearly income. In China they are 11.1x. China has printed 428% more money than the US has over recently. We are in bad shape, but they are in much worse shape. I am not an expert in currencies or investing, but the presentation made sense and is quite frightening to tell you the truth because they finance so much of our debt.

By the way, the reason they have so much in reserves is that the central bank TAKES dollars that people bring into China and PRINTS Yuan at the current rate. Then they invest those dollars treasuries. They are setting themselves up to crash much harder than we are.

At the surface, it seems like a no brainer to buy Yuan. Once it becomes a no brainer then the money has already been made. It is too easy and simple. Just like housing. Everyone kept buying because it will go up forever.

Really at the end of the day the Aussie dollar is your best bet because they have so many natural resources. Investing in China is ok as long as it isn't real estate in China or a company that keeps all of their reserves in Yuan.