Short China Because of Its Reserves?

 Article here

Friedman made a comment that shorting China would be a bad idea because of their excess foreign currency reserves - roughly $2 trillion.  But, Willis counters by saying that the only other times that a given country has held foreign currency reserves that were materially equatable to global economic output in terms of size, shorting would have been the right call.  In the 1920's, the US held huge foreign currency reserves.  In the 1980's, Japan held huge foreign currency reserves.  Thus, if you had shorted these countries in both instances (over a long period of time), you'd be 2-for-2 and have a little extra wealth in your pocket.

"It was the very process of generating massive reserves that created the risks which subsequently devastated the US and Japan. Both countries had accumulated reserves over a decade during which they experienced sharply undervalued currencies, rapid urbanization, and rapid growth in worker productivity (sound familiar?). These three factors led to large and rising trade surpluses which, when combined with capital inflows seeking advantage of the rapid economic growth, forced a too-quick expansion of domestic money and credit.
It was this money and credit expansion that created the excess capacity that ultimately led to the lost decades for the US and Japan. High reserves in both cases were symptoms of terrible underlying imbalances, and they were consequently useless in protecting those countries from the risks those imbalances posed."

http://blogs.reuters.com/felix-salmon/2010/02/03/shorting-reserves/