Why China's Euro Debt Buying Makes Sense

White House reporters during the Bill Clinton years got in the habit of listening for “the Clinton clause,” that carefully constructed nuance laid in advance against future events. I have trained myself to watch for the Chinese quid pro quo when it comes to any and all actions involving yuan exchange rates and shifts in their capital flows. This allowed me to identify their re-pegging of the yuan in July 2008 over the very same weekend Hank Paulson effectively nationalized Fannie Mae and Freddie Mac and to later identify the pas de deux between yuan revaluation and American quantitative easing.