December 8, 2010

Watch the Body Language

Here is an uncharacteristic photo of Vladimir Putin, looking overshadowed as he shakes hands with Wen Jiabao.

China and Russia have agreed to drop the dollar for bilateral trade and use their own currencies, whose relative values will be allowed to float.

This is a clever way for the Chinese to undermine the dollar. They are not attacking it overtly. Instead, they are setting up an arrangement which other economies, sooner or later, may request to join as a way to flee the dollar.

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