China to let Yuan Rise 5% against the US Dollar in 2011

According to a Chinese newspaper, China will let the yuan rise about 5 percent against the dollar in 2011 as it needs a stronger currency to combat inflation and avert asset bubbles.  I have favored Ben Bernanke's QE approach as it did help prevent a double dip, but more importantly, it pressured China to strengthen its currency.  When the US increased its money supply, through measures such as QE2, it also exported some inflation to China by forcing China to print more of its currency to purchase the new dollars created by QE2. 

Among other manipulative measures China has taken (hoarding precious metals and limiting the export of these metals), China has held an unfair advantage against the US with an extremely under-appreciated currency.  China has barely budged to appreciate its currency over the last 3 years and the Fed's QE2 decision has been the most successful method of forcing China to appreciate its currency.  The US can now focus on the bigger picture: Provide an accommodating environment for businesses to innovate and start planning for some fiscal discipline once the private sector has taken back the reigns.

Facebook Valued at $50 BILLION

Goldman Sachs is investing $450 million in Facebook at a $50 billion valuation, the New York Times' Dealbook reports.  Goldman's investment comes alongside a new $50 million investment from existing Facebook investor DST, the Russian investment firm that has also invested in Groupon and Zynga. And Goldman has the right to sell up to $75 million of its stake to DST, the NYT's Andrew Ross Sorkin and Evelyn Rusli report.  Also as part of the deal, Goldman will help raise up to another $1.5 billion for Facebook at that $50 billion valuation, according to the NYT…..