George Soros Vs PBoC - Currency Wars Escalate - Nathan McDonald

The Currency Wars that James Rickards famously penned have been raging for years. This conflict has typically been fought behind the scenes by Western powers and their allies against the East, who wish to see a new system put into place.

Russia has been one of the victims of the currency wars; their economy has suffered massive inflation and crushing trade sanctions due to Putin's unwillingness to go along blindly with Western powers, as so many before him have done.

China is another combatant in the currency wars; in fact, it is one of the most dominant and major players. China is possibly only second to the United States, who currently still has the luxury status of owning the world’s reserve currency - a status that they may lose in the future if Russia and China have any say in the matter.

Typically, these battles have been fought behind closed doors and through under-the-table trade deals. Yet the fight is now spilling out into center stage. Who are the combatants of this round? The well-known trader George Soros and the Peoples Bank of China [PBoC].

George Soros has been known in the past for breaking the BOE and for his part in the Asian Financial Crisis. So far it is unclear if his next target is China and its currencies.

Regardless of whether or not this is his target, the PBOC is not sitting by idly waiting for an attack to begin. In fact, they have recently published an article taunting George Soros for recent comments he made. The title of the article? "A declaration of war to the Chinese currency? Ha ha."

The reason for this article being written is comments made by George Soros in a recent Bloomberg TV interview that aired last week in which he stated that he is "betting against Asian Currencies."

The fact that this simple statement could prompt such a response from the PBOC of China shows the power that this man truly has in regards to affecting the forex markets. In addition to this, it shows the precarious state that China is currently facing.

Capital flight is, at this moment, a very real and serious threat that China is facing, on top of the mounting corruption that the country faces. Even a slight comment such as the one uttered by George Soros could cause escalating panic throughout the system, prompting a cascading flight of money from China.

Is a hard landing, as George Soros is indicating, upon China? Are they due for a collapse and correction that could send the world spiraling out of control?

The possible is very real and very near. Of this China knows and they are doing everything in their power to keep their fragile system held together. Only time will tell if they will be successful.