Chinese Currency

Chinese currency has been blamed on the job loss in U.S. and the pressure is mounting for China to float its currency. My prediction is RMB is going to start gradually appreciate in next 6 months and be fully floating in 5-7 years. The downside for a stronger RMB are
1. a 10% increse in RMB will increase 1% inflation rate in U.S and will hurt low income population harder.
2. China may not buy as many U.S. denominated bonds if it is going to devalue against Chinese RMB and instead it will demand U.S. to issue Yuan denominated bond which will generate some potical heat in U.S. and raise interest rate.
3. It will be cheaper for China to buy nature resources and will increase the price for crude oil.

The trade is to buy ETF CYB to play on Chinese currency appreciation. Do not expect any gain in short term but in two years, you can expect 10-20% return with very low risk.

I am buying 200 CYB at 25.34 (U$).