, you must bias sets denominated in rmb. it's very difficult. >> but is appetite for rmb waning? we know currency is not a one-way bet on aappreciation anymore. >> it's a short-term view. our investors are long-term investors. maybe currently the market is a little bit shaky, but in the past, in the last past years, the rmb was appreciating by 4% -- >> no, but i just wonder if the dynamics aren't shifting to a point at which having gotten a lot of appreciation out of the way. i think the imf downgrade its view to say the currency was only moderately undervalued, something to that effect. we've seen more activity on both sides, not just -- >> there's a need for diversification. in the next years, i think the chinese authorities, as imf says, they will have to make the segments improve and the chinese yuan, maybe in five years, ten years, will become normal currency, because today we must have variable for contracts in order for them to be involved in this currency. >> all right. global private equity funds have actually come

would feel there is only one side of the story, that the chinese work out to artificially keep this rmb at a particular level to bolster exports from china and in some ways doom the u.s. to its increasing poverty. the chinese will accept that position but they want to have their say. you don't see their side on fox news or m -- or nbc. host: jim laurie is an executive consultant with cc tb so let's go to a democratic caller in vermont. caller: this is more about continuity of news throughout the world. you take a lot of the major players, they are just repeating the same point over and over. i think this is more of an agenda to get a one world government kind of thing. what are your thoughts on that? guest: i don't subscribe to one world government kind of thing but what has evolved in media in general, as we have moved to the 500-channel universe and a multi it million url universe is that we no longer have the same kind of standards of broadcast journalism. that i grew up with. went on to0's and work in the 1980's. we had essentially three networks and their mission was to create a pr

>> well, i think it's very important part of the internationalization of the rmb. mean, we've obviously seen a few other centers open up outside of hong kong. from australia's perspective it makes sense to have convertibility between australian dollar and rmb. 30% of our exports last year went to china. just under 70% of our imports came from china. from that perspective it makes sense. from the chinese perspective it also makes sense. you know, they're looking to slowly move towards internationalization. this is another step along that process. i don't think australia will be the last center on this long journey they're embarking on. >> is this more of a symbolic change right now or a real game-changer versus a nondeliverable you could have put on in the past? >> well, i think it's getting closer towards being a real game-changer. in recent times we've also seen china moving towards steps towards opening or converting -- being able to convert capital account as well. one region will be able to do that, or that's certainly slated to do that. we've seen more reforms

on the payments and not about helping those already delinquent but it could also negatively affect rmbsse risk. for ever more details it is on the blog. simon? >> diana, thank you very much. >>> if you've just switched on cnbc, thank you for doing so. these are the headlines. u.s. consumer sentiment fell in early june to the lowest level in seven months. producer prices unexpect antly rose in june. the index inched up .1% last month. >>> china's gdp is slowing and slowed in the second quarter. grew 7.6% compared to a year earlier, this's the weakest pace of expansion in three years, tyler, for china. back to you. >> thanks. >>> let's go to brian shactman. >> looking at shares of sachs at the lows of the day. bank of america, merrill lynch doesn't like what they have seen since june, downgrading the stock to underperform seeing trends slowing and reducing the price target to $9 from 13. back to you. >> thanks very much. >>> when we come back, we'll check in with traders on the floor and see how they're playing the big market rally. the dow up strongly today. we'll see why some of the wea

if y can contain it and there weren't adverse consequences for some other currencies, such as the rmb, then it would be a price worth paying with other countries to support the europeans doing that. but linked to what i said earlier, the way that will happen is if the ecb gets more active. whilst a lot of conservative ecb conserve ties hide behind all this legal mumbo jumbo, as i would call it, they have got a mandate for inflation close to 2%. and if you look at the pmi survey, flash pmi as we had for the euro yesterday, what was most interesting in the general weakness, and again in the ifo this morning, is now germany is slowing sharply. and the ecb has got no excuse, from what i can see, to be a lot more active, which would potentially weaken the euro. certainly be a very helpful thing to solve in this mess. the one caveat i would add, which i think marty's piece doesn't really seem to at least focus on or perhaps acknowledge, if the euro were to continue to decline, other parts of the world that manage their currencies on a trade-weighted basis, including the chinese, that would

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the biggest news item this week is the rmb has been weakening n. ] .y impulse for the world. >> it is. the fact that we have negative nominal yields at the short end of japan and germany tells you people are worried out there. the u.s. is doing better in growth and revenues than a lot of other places. as long as that relative trade goes on, i'm going to feel good -- >> as a guy managing a lot of money, you're suggesting, your biggest fear when you go to bed at night is negative prices, falling prices, deflation is far more worrisome to you -- >> it's far more worrisome to me as a citizen. as a bondholder, that's one of the odd things out here. the central banks are worried about deflation. they're driving up the bond prices. that's funny if you stop and think about it. while they're doing that, it's been pretty good to hold bonds. >> is there a surprise sovereign out there at all? any country that's mispriced when you look at bonds or even municipal bonds -- is there anything where you say, you know what, it's not being appreciated properly? >> i think