China in the driver's seat

As the world's markets began to trade again this week, sentiments of an improving economy may be coming to fruition on news that China has stopped pegging its currency to protect the country's large exporting business from price volatility. News of China's move echoed in today's morning results in the world markets, as nearly all markets have seen a rise on growing confidence in the equities from China's switch to a floating currency. Although the switch does not erase the European sovereign debt problem or the growing deficits in the U.S., China is proving how its economy can be the motor of economic recovery that the world so desparately needs. One of the best signs for growing demand and confidence for investors is to see U.S. treasuries fall in price (as they did today) as it shows people are not just moving to the safety of government bonds. If China can continue to generate demand the world might soon be able to smile again.