http://tgs.nationalinterest.in/2009/05/28/dollar-renminbi-tango-or-tangle-part-2/ Geoeconomics in a changing world Thu, 11 Mar 2010 03:11:57 -0800 http://wordpress.org/?v=2.8.6 hourly 1 http://tgs.nationalinterest.in/2009/05/28/dollar-renminbi-tango-or-tangle-part-2/comment-page-1/#comment-636 corporate serf Mon, 08 Jun 2009 20:02:37 +0000 http://tgs.nationalinterest.in/?p=381#comment-636 Essentially, what the Chinese Central bank faces, is some variation of some optimal liquidation problem: It has a large exposure to USD through it's holding and current trade patterns. At some point it needs to (or perceives the need to) get at a smaller US dollar and asset exposure. The problem is to how to do this while approximately minimizing trading costs. Essentially, what the Chinese Central bank faces, is some variation of some optimal liquidation problem: It has a large exposure to USD through it’s holding and current trade patterns. At some point it needs to (or perceives the need to) get at a smaller US dollar and asset exposure. The problem is to how to do this while approximately minimizing trading costs.

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