Mr. Market appears as skeptical as yours truly that Chinese buying of Italian debt would be a game changer.
A quick Google search shows them buying European debt since at least last fall and the crisis has only intensified.
As far as the currency is concerned, it probably does not mean China would necessarily buy more euros. They would just likely buy fewer bunds and more BTPs (Italian government debt).
EUR/USD has retreated to where we began, now at 1.3565.
The selloff looks to be accelerating on fears that maybe Tim Geithner will do for Europe what he has done for the US…
