Soros Didn't Start China Currency "War," He's Following The Trend

The Chinese have much to learn about free markets, as their recent dust-up with George Soros proves. A research note yesterday note from Societe Generale illustrates this point well, as the Asian society’s central planners also might need to understand how trend following works. After all China's bluster and intimidation talk threatening short sellers to "back off," the former communistic regime might not fully understand the concept of free market trends judging by their identification of Soros as the target de jour.

Soros “declaring war on the renminbi,” as China's media so eagerly touted, was in fact only reiteration of previous economic discussions perhaps done with a different twist. Soros pronouncements at Davos wasn't even near the trend's beginning. Unlike his famous 1992 Bank of England back breaker that went against the grain, Soros is now joining a larger trend already in motion, days before the Soros news we labelled short China and/or Yuan "The Big Short II". But that trend could also be coming to an end, which might be fitting. Wouldn't it be odd if China's intimidation and bluster was actually the natural point of trend capitulation? That remains to be seen.

Soc Gen documents the asset flows and points to China trend starting in March 2013
Under a report titled “Mr Soros is not alone: $250bn net outflows from EM funds since March 2013,” Soc Gen's Global Asset Allocation strategy team, headed by Alain Bokobza, starts out with a bias disclosure: “This is not a political pamphlet, even if the title refers to one,” the January 28 report that monitors global asset flows declares.

Bokobza and his five person team monitor the nuance of how investors move money around. Looking at his work from a high level, trends can emerge that follow distinct fundamental logic.
[swpm_payment_button id=2022964]

Login needed to read rest of article


This content is exclusively for paying members. Access all of our content on including years of timeless investment news and in depth analysis for only a few dollars a month by signing up here while also supporting quality content and journalism, or learn more about our premium content here

If you are subscribed and having an account error please clear cache and then cookies if that does not work email and we will get back to you as quick as humanly possible

Saved Articles

The Life and Career of Charlie Munger

Charlie is more than just Warren Buffett’s friend and Berkshire Hathaway’s Vice Chairman – Buffett has actually credited him with redefining how he looks at investing. Now you can learn from Charlie firsthand via this incredible ebook and over a dozen other famous investor studies by signing up below:

  • Learn from the best and forever change your investing perspective
  • One incredible tidbit of knowledge after another in the page-turning masterpiece of a book
  • Discover the secrets to Charlie’s success and how to apply it to your investing
Never Miss A Story!
Subscribe to ValueWalk Newsletter. We respect your privacy.

Congrats! Are you a smart person?

We have an exclusive targeted & limited time offer for being a sophisticated and loyal reader.

ValueWalkPremium is a website and newsletter on the latest industry news much of which is not in the public domain and obtained via our sources.

We also have 10 years of resources on how to use this information to better your investment process.

Sign up for  today and get our exclusive content for 40% off. This is our second biggest discount ever!!

Use coupon code VIP20 or click on the button below

Limited time offer only ENDS 3/31/2020 or after the next 45 subscribers take advantage whichever comes first – please do not share this discount with others