By Richard Russell
What do you do when the market is crashing? If you’re the People’s Bank of China, you don’t fool around; you devalue your currency. This is exactly what China has done.
The devaluation makes China’s exports more competitive, and I wonder, is this the beginning of currency wars? The US stock market has backed off a bit as it absorbs the meaning of the Chinese devaluation.
As I write half an hour before the close, there is obviously confusion and puzzlement on the part of US investors. Industrials are down 213 but still above 17,000, Transports are down 62 but still above 8,000, and the Nasdaq is down 70 and hanging by a thread above 5,000.
Currently gold is up 4 to 1108.1 and silver is up .01 to 15.30. Confused investors are buying small quantities of gold for safety even though they do not know what the danger is.
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