In today's Khan Academy video, "Debt Loops Rationale and Effects," Sal looks at the positives and negatives--for both China and the U.S.--of the on-going pegging of the Yuan on global markets. He discusses the likely outcome once the process is halted and the result when it is reversed. Very simply, it has held interest rates low and enabled the U.S. to finance its massive debt at historically low interest rates. Understanding this whole dynamic is crucial, IMHO, for the DIY investor going forward because it will be a driving force. In fact, it could be the driving force of the next big crisis - banks hold Treasuries! Central banks around the world hold the dollar as a reserve currency in the form of Treasuries.
If you are seeking investment help, look at the video here on my services. If you are seeking a different approach to managing your assets, you have landed at the right spot. I am a fee-only advisor registered in the State of Maryland, charge less than half the going rate for investment management, and seek to teach individuals how to manage their own assets using low-cost indexed exchange traded funds. Please call or email me if interested in further details. My website is at http://www.rwinvestmentstrategies.com. If you are new to investing, take a look at the "DIY Investor Newbie" posts here by typing "newbie" in the search box above to the left. These take you through the basics of what you need to know in getting started on doing your own investing.