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Given that the Chinese central bank is printing yuan in order to keep it devalued to other foreign currencies, especially relative to the dollar, a question that may have jumped into your brain is, is this causing inflation? And when I talk about inflation, I'm talking about price inflation. Is it making a basket of goods in China more expensive? And the other type of inflation that the word inflation is sometimes to referring to is monetary inflation. That, by definition, is increasing. They are definitely increasing the money supply, but is it making the price of goods and services in China more expensive? And to answer that question, I have this article here from the "New York Times" written by Keith Bradsher, early January, 2011. And he writes, "in China, consumer prices were 5.1% higher in November than a year earlier." Remember, in the US, we try to target inflation to be between 1 and 3%. So the official government data. So this is according to official government data, they admit that their inflation is at 5.1%. But the next sentence is even more interesting. "And many economists say the official figures actually understate the rate of inflation, which might in reality be twice as high." And there's tons of ways to kind of engineer the actual inflation depending on what the basket of goods is and how you adjust for things. Now though, that cheap currency policy seems to be reaching its limits. The extra renminbi-- and this is a big point of confusion when people talk about the currency in China. The renminbi is the name of the currency while the yuan is kind of when someone talks about hey, I give you five yuan, or you owe me five yuan, something like. They wouldn't say you owe me five renminbi. And a good analogy is if you go to Great Britain and you buy something, they'll say, well it'll be five pounds. So in Great Britain, five pounds is what they say when you're actually buying something, but the name of the currency is called the sterling. It's kind of like if people called the dollar US legal tender. That's the equivalent of renminbi, while you yuan would be like the dollar. So five pounds is called the sterling. So the similar analogy, five yuan, they call that the renminbi. So they're saying the extra renminbi are feeding inflation. That is starting to undermine exporters' price competitiveness. Just as a stronger renminbi would do if Beijing was not intervening to begin with. So the whole reason why they're printing this money is to keep the currency devalued, but that's making things more expensive in terms of yuan. So in the end, that's kind of counteracting some of this cheap currency policy. It's making their exports more expensive. Money supply figures for December, which the central bank released on Tuesday, showed that cash and bank deposits were increasing at a rate twice as fast as even China's soaring economy. So if you increase the money supply roughly in line with the growth in the economy, then you wouldn't experience too much inflation. But they're increasing it twice as fast. Ever more renminbi are available to buy goods and services. So you see they're clearly doing that to try to keep their currency devalued, but they're reaching kind of-- it seems kind of a breaking point where they won't be able to do it as aggressively going forward.