The copper price has been nearly fully re-inflated to pre-bubble popping levels. See here.
Copper kettle mania in China leads to massive jump in prices
As one commodities banker told me: "The Chinese traders assure me that demand for copper kettles from households has increased massively. They can't buy copper derivatives, but they can buy those."
This is not the Chinese government cleverly diversifying its way out of the dollar, as some retail commodities salesmen and advisers would have it. The Chinese state has declared purchases of just 235,000 tonnes this year, and has made it clear that it is unhappy with the rise in the copper price, and with private Chinese speculation.
Hell hath no fury like a Communist Central Bank's currency scorned?
What they plan to do about it, what they can do about it, and/or when they plan to do something about it are certainly topics open for discussion.
Perhaps the small Chinese investors have a savvy exit strategy all planned out. Then again, maybe they don't. Who knows?
NBER Paper: "Strategic default rarely occurs" - Ht to Nick Timiraos for link to the paper. An NBER paper from Kristopher Gerardi, Kyle F. Herkenhoff, Lee E. Ohanian, and Paul S. Willen Can’t Pay or Won’t...
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