TRENDS THIS WEEK:
“Surprise yuan devaluation,”
no surprise to Trends Journal;
New “surprise” coming.
By Gerald Celente
Publisher, Trends Journal
KINGSTON, NY, 12 August 2015—Following China’s yuan devaluation, headlines around the world screamed “surprise.” China’s Global Times wrote, “The People’s Bank of China surprisingly devalued the Chinese yuan by nearly 2 percent against the US dollar on Tuesday.” “FOREX-Yuan in biggest fall since 1994 after surprise devaluation,” Reuters. “Dow Jones Industrial Average Plunges 200 Points After China's Surprise Yuan Devaluation,” International Business Times.
“Surprise?” Not to the Trends Research Institute.
On Friday, July 24, China’s State Council telegraphed the move when it announced a series of measures to pump up the economy and boost declining exports. Although it wasn’t reported as such, it was clear to the institute the yuan would be devalued. The following Monday, in our Trends in the News broadcast, I read the page A6 headline of the weekend Wall Street Journal, “China Pledges Trade Support Amid Slowdown,” stating: “Here’s the story … Let’s make this simple. They’re going to devalue the currency, capisce? How do you say capisce in Chinese?"
There are two important trend-tracking lessons to take from this:
First, Whether Beijing, Moscow, Paris, Rome, or Washington, DC – at all levels of government, Friday is the favorite day for releasing information governments are required and/or feel obliged to make public. What makes Friday different than any other day is that most of the press corps takes off early for the weekend, thus, news that may might otherwise receive major media coverage, and possibly upset the public, may slip by the press corp. And if it does make the news, readership of Saturday newspapers and viewership of weekend television newscasts are the lowest of any day of the week.
Second, read Saturday’s newspapers and follow your favorite online news sources. As evidenced by China’s State Council report, momentous decisions are made public when the public is not paying attention. The moral of the story, as evidenced by our forecast: If you want to stay on-trend, read all about it when hardly anyone else does!
Finally, not only were we not surprised by the yuan devaluation, in that same Trends in the News broadcast we assessed the implications of devaluation without being swayed by the emotion of the time that now prevails: “And that’s not going to get them out of this. You’ve got a bunch of rookies playing in a big game over there and they don’t know how to get out of it. Their real estate bubble has burst; they’re just pumping it up with polluted Chinese air. And their equity markets, they can’t fix those either.” (Click here for video)
And China is not alone. As we wrote last week, “Commodities collapsing, currencies plunging. Will stock markets crash?”
Global market mayhem is on the near horizon.