Deadline Day

Again, it'll be difficult for me to post. I'll try to get something up in the afternoon.

But if I have any advice for you, I'd say invest in gold:

China has resolved to shift some of its foreign exchange reserves -- now in excess of $800 billion -- away from the U.S. dollar and into other world currencies in a move likely to push down the value of the greenback, a high-level state economist who advises the nation's economic policymakers said in an interview Monday.

As China's manufacturing industries flood the world with cheap goods, the Chinese central bank has invested roughly three-fourths of its growing foreign currency reserves in U.S. Treasury bills and other dollar-denominated assets. The new policy reflects China's fears that too much of its savings is tied up in the dollar, a currency widely expected to drop in value as the U.S. trade and fiscal deficits climb.

This is what I've always feared. For almost the duration of the Bush presidency, China has basically been paying the US to buy their goods. They send tons of imports over here, and we send our debt over there. Worked good for both countries, for a while: We found a willing repository for our debt so we could continue to borrow and spend, and China got its manufacturers access to the US market and basically financed that industry's expansion. But it could never last forever: sooner or later China was going to wake up and say "This good be very very bad if the dollar tanks. Maybe we need to diversify."

Woe to us if this is anything more than a temporary shift.