mostlyharmless
Veteran Member
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ECON Drudge: China may balk at buying more US debt... Developing...
- Thread starter mostlyharmless
- Start date
Don't take much to predict that. First thing, they can't buy unless we buy first. And we ain't buyng. So O is going to have a big problem because there is nobody else out there now that oil had gone into the tank.
Folks, Atlas has shrugged.
O wants to spend money, but won't be able to sell bonds. Just print the money maybe? Sure would save interest costs.
Folks, Atlas has shrugged.
O wants to spend money, but won't be able to sell bonds. Just print the money maybe? Sure would save interest costs.
pixmo
Bucktoothed feline member
Government Panic Could Herald Dollar Panic
One of the few things more troubling for an economy than government intervention is government intervention driven by panic. Time and again, history has shown that when governments rush to engineer solutions to pressing problems, unintended difficulties arise.
In the current crisis, there is growing evidence that Washington is in a state of increasing panic. Despite its massive cash injections, market manipulations and 'rescue' plans, the recession is clearly deepening and spreading. With little to show thus far, politicians don't know if they should redouble past efforts, break ground on new initiatives, or both. However all agree, unfortunately, that the consequences of doing too little far outweigh the consequences of doing too much.
Although there are many parallels between the current crisis and the Crash of 1929, one key difference is the global profile of the U.S. dollar. In 1929, the dollar was on the rise, and would soon eclipse the British Pound Sterling as the world's 'reserve' currency. Furthermore, the American economy was fundamentally so strong that in 1934 America was the only major nation able to maintain a currency tied to gold.
Ever since, the U.S. dollar's privileged 'reserve' status has been a principal factor in America's continued prosperity. The dollar's unassailable position has enabled successive American governments to disguise the vast depletion of America's wealth and to successfully increase U.S. Treasury debt to where the published debt now accounts for some 100 percent of GDP. The total of U.S. Government debt, including IOU's and unfunded programs, now stands at a staggering $50 trillion, or five times GDP! If the dollar were just another currency, this never would have been possible.
In today's crisis however, the dollar is likely making its last star turn as the leading man in the global financial drama. Other stronger, less burdened currencies are waiting in the wings for the old gent to take his final bows.
The dollar's demise is being catalyzed by the neglect of the Federal Government. Instead of enacting policies that would restructure the U.S. economy, and restore productive, non-inflationary wealth creation, Congress is simply financing the old crumbling edifice.
Faced with the growing realization that America is not doing the work necessary to right its economic ship, it will not be long before America's primary creditors begin to seriously question the nation's ability to service, let alone repay, its debts.
There is now the prospect (inconceivable until recently), that America could lose its prestigious 'triple-A' credit rating. In today's risk adverse market, this could cost the Treasury one percent in interest on long bonds. Each additional percentage point of interest would cost America some $10 billion a year on each trillion dollars of new debt, or some $300 billion over the life of a 30-year bond.
Many of the foreign governments who hold huge amounts of U.S. dollar Treasury debt, such as China and Japan, have announced plans to spend money on their own ailing economies. Should these foreign central banks divert to domestic initiatives some of the funds used to buy U.S. Treasuries, serious upward pressure on U.S. interest rates will result. Should they actually sell parts or all of their holdings they will likely put serious downward pressure on the U.S. dollar. Last week, a Chinese official claimed the U.S. dollar should be phased out as the world's 'reserve' currency.
In the short term, as dollar 'carry-trades' continue to be unwound and questions of political will and falling interest rates haunt the Euro and some other currencies, the U.S. dollar may be the recipient of some upward appreciation. But with the American Government appearing increasingly to be in panic mode, a run on the U.S. dollar could develop rapidly into cascading devaluation. Even if no such panic run materializes the long-term outlook for the U.S. dollar is one of high risk and low return. This beckons major upward pressure on precious metals.
http://news.goldseek.com/JohnBrowne/1231366042.php
One of the few things more troubling for an economy than government intervention is government intervention driven by panic. Time and again, history has shown that when governments rush to engineer solutions to pressing problems, unintended difficulties arise.
In the current crisis, there is growing evidence that Washington is in a state of increasing panic. Despite its massive cash injections, market manipulations and 'rescue' plans, the recession is clearly deepening and spreading. With little to show thus far, politicians don't know if they should redouble past efforts, break ground on new initiatives, or both. However all agree, unfortunately, that the consequences of doing too little far outweigh the consequences of doing too much.
Although there are many parallels between the current crisis and the Crash of 1929, one key difference is the global profile of the U.S. dollar. In 1929, the dollar was on the rise, and would soon eclipse the British Pound Sterling as the world's 'reserve' currency. Furthermore, the American economy was fundamentally so strong that in 1934 America was the only major nation able to maintain a currency tied to gold.
Ever since, the U.S. dollar's privileged 'reserve' status has been a principal factor in America's continued prosperity. The dollar's unassailable position has enabled successive American governments to disguise the vast depletion of America's wealth and to successfully increase U.S. Treasury debt to where the published debt now accounts for some 100 percent of GDP. The total of U.S. Government debt, including IOU's and unfunded programs, now stands at a staggering $50 trillion, or five times GDP! If the dollar were just another currency, this never would have been possible.
In today's crisis however, the dollar is likely making its last star turn as the leading man in the global financial drama. Other stronger, less burdened currencies are waiting in the wings for the old gent to take his final bows.
The dollar's demise is being catalyzed by the neglect of the Federal Government. Instead of enacting policies that would restructure the U.S. economy, and restore productive, non-inflationary wealth creation, Congress is simply financing the old crumbling edifice.
Faced with the growing realization that America is not doing the work necessary to right its economic ship, it will not be long before America's primary creditors begin to seriously question the nation's ability to service, let alone repay, its debts.
There is now the prospect (inconceivable until recently), that America could lose its prestigious 'triple-A' credit rating. In today's risk adverse market, this could cost the Treasury one percent in interest on long bonds. Each additional percentage point of interest would cost America some $10 billion a year on each trillion dollars of new debt, or some $300 billion over the life of a 30-year bond.
Many of the foreign governments who hold huge amounts of U.S. dollar Treasury debt, such as China and Japan, have announced plans to spend money on their own ailing economies. Should these foreign central banks divert to domestic initiatives some of the funds used to buy U.S. Treasuries, serious upward pressure on U.S. interest rates will result. Should they actually sell parts or all of their holdings they will likely put serious downward pressure on the U.S. dollar. Last week, a Chinese official claimed the U.S. dollar should be phased out as the world's 'reserve' currency.
In the short term, as dollar 'carry-trades' continue to be unwound and questions of political will and falling interest rates haunt the Euro and some other currencies, the U.S. dollar may be the recipient of some upward appreciation. But with the American Government appearing increasingly to be in panic mode, a run on the U.S. dollar could develop rapidly into cascading devaluation. Even if no such panic run materializes the long-term outlook for the U.S. dollar is one of high risk and low return. This beckons major upward pressure on precious metals.
http://news.goldseek.com/JohnBrowne/1231366042.php
When the sheeple realize that $775 billion will not stop the bleeding, and the credit rating of the U.S. drops, full-bore panic will begin to take hold.
Obama is not even President yet, and he is failing miserably.
Obama will not be able to blame the "Panic" on Bush, because the Panic will be of Obama's own doing.
Obama is not even President yet, and he is failing miserably.
Obama will not be able to blame the "Panic" on Bush, because the Panic will be of Obama's own doing.
Hacker
Computer Hacking Pirate
When the sheeple realize that $775 billion will not stop the bleeding, and the credit rating of the U.S. drops, full-bore panic will begin to take hold.
Obama is not even President yet, and he is failing miserably.
Obama will not be able to blame the "Panic" on Bush, because the Panic will be of Obama's own doing.
Someday, maybe the sheeple will realize that increasing our debt actually makes the problems worse. The most recent bailout is causing our economy to decline - and further bailouts will cause an even more pronounced decline.
This will end badly.
jed turtle
a brother in the Lord
unfortunately, it is not very likely that the sheep are going to realize any such thing. between the joe sixpacks and the cultural butterflies, there are very few left who have a clue to anything but day to day personal activities.
even those who should be aware, are still buying into the stock market and figuring out what angle to take to still make money in investments.
yes, it will end badly.
America's Total Debt Report $ 53 Trillion - - and soaring!
I keep hearing US debt numbers around $12 trillion. Well this guy says it is $ 53 trillion and has the goods to back up his claim!
I bet that China knows this too!
This guy has all the graphs and charts!
This will put a hurting on you:
BOTTOM-LINE - - DEBT SUMMARY TABLE
AMERICA'S TOTAL DEBT (as of Jan. 1, 2008)
- $53 Trillion -
- add another $60 trillion for other contingencies such as Social Security/Medicare/Medicaid -
Our Federal Government Debt Report shows $9.2 Trillion of debt as of end CY 2007, the State & Local Government Report shows debt of $2.2 Trillion, and $41.6 Trillion of private (household, business and financial sector) debt is revealed in America's Total Debt Report.
These sum to $53 Trillion - - equivalent to $175,154 per capita, or $700,616 per family of 4.
(This sum does not include the federal government's un-funded contingent liabilities such as social security/Medicare/Medicaid estimated at $57 trillion, plus additional unknown amounts(?) for other contingencies listed below.)
http://mwhodges.home.att.net/nat-debt/debt-nat-a.htm#bigpicture
It took the wind out of my sails!
I keep hearing US debt numbers around $12 trillion. Well this guy says it is $ 53 trillion and has the goods to back up his claim!
I bet that China knows this too!
This guy has all the graphs and charts!
This will put a hurting on you:
BOTTOM-LINE - - DEBT SUMMARY TABLE
AMERICA'S TOTAL DEBT (as of Jan. 1, 2008)
- $53 Trillion -
- add another $60 trillion for other contingencies such as Social Security/Medicare/Medicaid -
Our Federal Government Debt Report shows $9.2 Trillion of debt as of end CY 2007, the State & Local Government Report shows debt of $2.2 Trillion, and $41.6 Trillion of private (household, business and financial sector) debt is revealed in America's Total Debt Report.
These sum to $53 Trillion - - equivalent to $175,154 per capita, or $700,616 per family of 4.
(This sum does not include the federal government's un-funded contingent liabilities such as social security/Medicare/Medicaid estimated at $57 trillion, plus additional unknown amounts(?) for other contingencies listed below.)
http://mwhodges.home.att.net/nat-debt/debt-nat-a.htm#bigpicture
It took the wind out of my sails!
mostlyharmless
Veteran Member
Here's the article Drudge links to.
http://www.iht.com/articles/2009/01/07/business/yuan.php
U.S. debt is losing its appeal in China
By Keith Bradsher
Published: January 8, 2009
HONG KONG: China has bought more than $1 trillion in American debt, but as the global downturn has intensified, Beijing is starting to keep more of its money at home - a shift that could pose some challenges to the U.S. government in the near future but eventually may even produce salutary effects on the world economy.
At first glance, the declining Chinese appetite for U.S. debt - apparent in a series of hints from Chinese policy makers over the past two weeks, with official statistics due for release in the next few days - comes at an inopportune time. On Tuesday, the U.S. president-elect, Barack Obama, said Americans should get used to the prospect of "trillion-dollar deficits for years to come" as he seeks to finance an $800 billion economic stimulus package.
Normally, China would be the most avid taker of the debt required to pay for those deficits, mainly short-term Treasury securities. In the past five years, China has spent as much as one-seventh of its entire economic output on the purchase of foreign debt - largely U.S. Treasury bonds and American mortgage-backed securities.
But now, Beijing is seeking to pay for its own $600 billion economic stimulus - just as tax revenue falls sharply as the Chinese economy slows. Regulators have ordered banks to lend more money to small and midsize enterprises, many of which are struggling with slower exports, and Chinese bankers say they are being instructed to lend more to local governments to allow them to build new roads and other projects as part of the stimulus program.
"All the key drivers of China's Treasury purchases are disappearing," said Ben Simpfendorfer, an economist in the Hong Kong office of the Royal Bank of Scotland. "There's a waning appetite for dollars and a waning appetite for Treasuries. And that complicates the outlook for interest rates."
Fitch Ratings, the credit rating agency, forecasts that China's foreign reserves will increase by $177 billion this year - a large number, but down sharply from an estimated $415 billion last year.
In the United States, China's voracious demand for American bonds has helped keep interest rates low for borrowers ranging from the government to home buyers. Reduced Chinese enthusiasm for buying those bonds takes away some of this dampening effect.
But with U.S. interest rates still at very low levels after recent cuts to stimulate the economy, it is quite cheap for the U.S. Treasury to raise capital now. And there seem to be no shortage of buyers for Treasury bonds and other debt instruments: Prices for U.S. debt have soared as yields have declined.
The long-term effects of this shift in capital flows - with China keeping more of its money home and the U.S. economy becoming less dependent on one lender - are unclear, but the phenomenon is something economists have said is long overdue.
What is clear is that the effect of the global downturn on China's finances has been drastic. As recently as 2007, tax revenue soared 32 percent, as factories across China ran flat out. But by November, government revenue had actually dropped 3 percent from a year earlier. That prompted Finance Minister Xie Xuren to warn Monday that 2009 would be "a difficult fiscal year."
A senior central bank official mentioned last month that China's $1.9 trillion in foreign exchange reserves had actually begun to shrink. The reserves - mainly bonds issued by the U.S. Treasury and by Fannie Mae and Freddie Mac, the mortgage finance companies - had been rising quickly ever since the Asian financial crisis in 1998.
The strength of the dollar against the euro in the fourth quarter of last year contributed to slower growth in China's foreign reserves, said Fan Gang, an academic adviser to China's central bank, at a conference in Beijing on Tuesday. The central bank keeps track of the total value of its reserves in dollars and a weaker euro means that euro-denominated assets in those reserves are worth less in dollars, decreasing the total value of the reserves.
But the pace of China's accumulation of reserves began slowing in the third quarter along with the slowing of the Chinese economy, and appears to reflect much broader shifts.
China manages its reserves with considerable secrecy, but economists believe about 70 percent is in dollar-denominated assets and most of the rest in euros. The country has bankrolled its huge reserves by effectively requiring its entire banking sector, which is state-controlled, to hand nearly one-fifth of its deposits over to the central bank. The central bank, in turn, has used the money to buy foreign bonds.
Now the central bank is rapidly reducing this requirement and pushing banks to lend more money instead.
At the same time, three new trends mean that fewer dollars are pouring into China - and as fewer dollars flow into China, the government has fewer dollars to buy American bonds and help finance the U.S. trade and budget deficits.
The first, little-noticed trend is that the monthly pace of foreign direct investment in China has fallen by more than a third since the summer. Multinational companies are hoarding their cash and cutting back on the construction of factories.
The second trend is that the combination of a housing bust and a two-thirds fall in the mainland Chinese stock markets over the past year has resulted in moves by many overseas investors - and even some Chinese - to get money quietly out of the country. They are doing so despite China's fairly stringent currency controls, prompting the director of the State Administration of Foreign Exchange, Hu Xiaolian, to warn in a statement Tuesday of "abnormal" capital flows across China's borders; she provided no statistics.
China's most porous border in terms of money flows is with Hong Kong, a semi-autonomous Chinese territory that has its own internationally convertible currency. So much Chinese money has poured into Hong Kong and been converted into Hong Kong dollars that the territory has had to issue billions of dollars' worth of extra currency in the past two months to meet the demand, shattering its previous records for such issuance.
A third trend that may further slow the flow of dollars into China is the reduction of its huge trade surpluses.
China's trade surplus set another record in November, at $40.1 billion. But because prices of Chinese imports like oil are starting to recover while demand remains weak for Chinese exports like consumer electronics, most economists expect China to run trade surpluses closer to $30 billion a month.
That would give China a sizable sum to invest abroad. But it would be considerably less than $50 billion a month that it poured into international financial markets - mainly U.S. bond markets - during the first half of 2008.
"The pace of foreign currency flows into China has to slow," and therefore the pace of China's reinvestment of that currency in foreign bonds will also slow, said Dariusz Kowalczyk, the chief investment officer at SJS Markets, a Hong Kong securities firm.
For a combination of financial and political reasons, the decline in China's purchases of dollar-denominated assets may be less steep than the overall decline in its purchases of foreign assets.
Many mainland Chinese companies are keeping more of their dollar revenues overseas instead of bringing them home and converting them into yuan for deposit in Chinese banks. In essence, they would not show up on the central bank's books. So, overall Chinese demand for dollars would not be falling as much as the government's demand for dollars, said Sherman Chan, an economist in the Sydney office of Moody's Economy.com.
Treasury data from Washington suggest the Chinese government might be allocating a higher proportion of its foreign currency to the dollar in recent weeks and less to the euro. The data also suggest China is buying more Treasuries and fewer bonds from Fannie Mae or Freddie Mac.
Figures from the U.S. Federal Reserve and the Treasury point to a sharp increase in Chinese holdings of Treasury bonds in October. China passed Japan in September as the largest overseas holder of Treasuries, and took a commanding lead in October, with $652.9 billion compared to $585.5 billion for Japan.
But specialists in international money flows caution against relying too heavily on these statistics. They mostly count bonds that the Chinese government has bought directly, and exclude purchases made through banks in London and Hong Kong; with the financial crisis weakening many banks, the Chinese government has a strong incentive to buy more of its bonds directly.
The overall pace of foreign reserve accumulation in China seems to have slowed so much that even if all the remaining purchases were U.S. Treasuries, the Chinese government's overall purchases of dollar-denominated assets will have fallen, economists said.
But China's leadership is likely to avoid any complete halt to purchases of Treasuries for fear of looking like it is torpedoing the chances for a U.S. economic recovery at a vulnerable time, said Paul Tang, the chief economist at the Bank of East Asia here.
"This is a political decision," he said. "This is not purely an investment decision."
http://www.iht.com/articles/2009/01/07/business/yuan.php
U.S. debt is losing its appeal in China
By Keith Bradsher
Published: January 8, 2009
HONG KONG: China has bought more than $1 trillion in American debt, but as the global downturn has intensified, Beijing is starting to keep more of its money at home - a shift that could pose some challenges to the U.S. government in the near future but eventually may even produce salutary effects on the world economy.
At first glance, the declining Chinese appetite for U.S. debt - apparent in a series of hints from Chinese policy makers over the past two weeks, with official statistics due for release in the next few days - comes at an inopportune time. On Tuesday, the U.S. president-elect, Barack Obama, said Americans should get used to the prospect of "trillion-dollar deficits for years to come" as he seeks to finance an $800 billion economic stimulus package.
Normally, China would be the most avid taker of the debt required to pay for those deficits, mainly short-term Treasury securities. In the past five years, China has spent as much as one-seventh of its entire economic output on the purchase of foreign debt - largely U.S. Treasury bonds and American mortgage-backed securities.
But now, Beijing is seeking to pay for its own $600 billion economic stimulus - just as tax revenue falls sharply as the Chinese economy slows. Regulators have ordered banks to lend more money to small and midsize enterprises, many of which are struggling with slower exports, and Chinese bankers say they are being instructed to lend more to local governments to allow them to build new roads and other projects as part of the stimulus program.
"All the key drivers of China's Treasury purchases are disappearing," said Ben Simpfendorfer, an economist in the Hong Kong office of the Royal Bank of Scotland. "There's a waning appetite for dollars and a waning appetite for Treasuries. And that complicates the outlook for interest rates."
Fitch Ratings, the credit rating agency, forecasts that China's foreign reserves will increase by $177 billion this year - a large number, but down sharply from an estimated $415 billion last year.
In the United States, China's voracious demand for American bonds has helped keep interest rates low for borrowers ranging from the government to home buyers. Reduced Chinese enthusiasm for buying those bonds takes away some of this dampening effect.
But with U.S. interest rates still at very low levels after recent cuts to stimulate the economy, it is quite cheap for the U.S. Treasury to raise capital now. And there seem to be no shortage of buyers for Treasury bonds and other debt instruments: Prices for U.S. debt have soared as yields have declined.
The long-term effects of this shift in capital flows - with China keeping more of its money home and the U.S. economy becoming less dependent on one lender - are unclear, but the phenomenon is something economists have said is long overdue.
What is clear is that the effect of the global downturn on China's finances has been drastic. As recently as 2007, tax revenue soared 32 percent, as factories across China ran flat out. But by November, government revenue had actually dropped 3 percent from a year earlier. That prompted Finance Minister Xie Xuren to warn Monday that 2009 would be "a difficult fiscal year."
A senior central bank official mentioned last month that China's $1.9 trillion in foreign exchange reserves had actually begun to shrink. The reserves - mainly bonds issued by the U.S. Treasury and by Fannie Mae and Freddie Mac, the mortgage finance companies - had been rising quickly ever since the Asian financial crisis in 1998.
The strength of the dollar against the euro in the fourth quarter of last year contributed to slower growth in China's foreign reserves, said Fan Gang, an academic adviser to China's central bank, at a conference in Beijing on Tuesday. The central bank keeps track of the total value of its reserves in dollars and a weaker euro means that euro-denominated assets in those reserves are worth less in dollars, decreasing the total value of the reserves.
But the pace of China's accumulation of reserves began slowing in the third quarter along with the slowing of the Chinese economy, and appears to reflect much broader shifts.
China manages its reserves with considerable secrecy, but economists believe about 70 percent is in dollar-denominated assets and most of the rest in euros. The country has bankrolled its huge reserves by effectively requiring its entire banking sector, which is state-controlled, to hand nearly one-fifth of its deposits over to the central bank. The central bank, in turn, has used the money to buy foreign bonds.
Now the central bank is rapidly reducing this requirement and pushing banks to lend more money instead.
At the same time, three new trends mean that fewer dollars are pouring into China - and as fewer dollars flow into China, the government has fewer dollars to buy American bonds and help finance the U.S. trade and budget deficits.
The first, little-noticed trend is that the monthly pace of foreign direct investment in China has fallen by more than a third since the summer. Multinational companies are hoarding their cash and cutting back on the construction of factories.
The second trend is that the combination of a housing bust and a two-thirds fall in the mainland Chinese stock markets over the past year has resulted in moves by many overseas investors - and even some Chinese - to get money quietly out of the country. They are doing so despite China's fairly stringent currency controls, prompting the director of the State Administration of Foreign Exchange, Hu Xiaolian, to warn in a statement Tuesday of "abnormal" capital flows across China's borders; she provided no statistics.
China's most porous border in terms of money flows is with Hong Kong, a semi-autonomous Chinese territory that has its own internationally convertible currency. So much Chinese money has poured into Hong Kong and been converted into Hong Kong dollars that the territory has had to issue billions of dollars' worth of extra currency in the past two months to meet the demand, shattering its previous records for such issuance.
A third trend that may further slow the flow of dollars into China is the reduction of its huge trade surpluses.
China's trade surplus set another record in November, at $40.1 billion. But because prices of Chinese imports like oil are starting to recover while demand remains weak for Chinese exports like consumer electronics, most economists expect China to run trade surpluses closer to $30 billion a month.
That would give China a sizable sum to invest abroad. But it would be considerably less than $50 billion a month that it poured into international financial markets - mainly U.S. bond markets - during the first half of 2008.
"The pace of foreign currency flows into China has to slow," and therefore the pace of China's reinvestment of that currency in foreign bonds will also slow, said Dariusz Kowalczyk, the chief investment officer at SJS Markets, a Hong Kong securities firm.
For a combination of financial and political reasons, the decline in China's purchases of dollar-denominated assets may be less steep than the overall decline in its purchases of foreign assets.
Many mainland Chinese companies are keeping more of their dollar revenues overseas instead of bringing them home and converting them into yuan for deposit in Chinese banks. In essence, they would not show up on the central bank's books. So, overall Chinese demand for dollars would not be falling as much as the government's demand for dollars, said Sherman Chan, an economist in the Sydney office of Moody's Economy.com.
Treasury data from Washington suggest the Chinese government might be allocating a higher proportion of its foreign currency to the dollar in recent weeks and less to the euro. The data also suggest China is buying more Treasuries and fewer bonds from Fannie Mae or Freddie Mac.
Figures from the U.S. Federal Reserve and the Treasury point to a sharp increase in Chinese holdings of Treasury bonds in October. China passed Japan in September as the largest overseas holder of Treasuries, and took a commanding lead in October, with $652.9 billion compared to $585.5 billion for Japan.
But specialists in international money flows caution against relying too heavily on these statistics. They mostly count bonds that the Chinese government has bought directly, and exclude purchases made through banks in London and Hong Kong; with the financial crisis weakening many banks, the Chinese government has a strong incentive to buy more of its bonds directly.
The overall pace of foreign reserve accumulation in China seems to have slowed so much that even if all the remaining purchases were U.S. Treasuries, the Chinese government's overall purchases of dollar-denominated assets will have fallen, economists said.
But China's leadership is likely to avoid any complete halt to purchases of Treasuries for fear of looking like it is torpedoing the chances for a U.S. economic recovery at a vulnerable time, said Paul Tang, the chief economist at the Bank of East Asia here.
"This is a political decision," he said. "This is not purely an investment decision."
dragonslayer2001
Inactive
Nobody
cared. Some of US have warned for years, and my warnings to family and friends predates my time on TB by 7 years, that the bubble was the largest in human history, and it had to pop.
Here on TB, the majority view was (don't care) or TOO BIG TOO FAIL, the world 'can't afford' to let the dollar crash.
You could throw all the history at them you wanted, steep denial was in effect for the last several years, with almost all members.
Here it is. Too Big to Fail is simply too big to keep up.
2-6 months of faltering T bill sales or no sales will lock up the Federal Government. Mass layoffs and mass business closings will further impact tax collection of millions upon millions of workers, and hundreds of thousands of businesses.
End badly? Wake up, you and everyone you know are in for about 10 years of hell. and most likely world war.
I am not sure the climate is going to cooperate for another 10 years myself though. One year, ONE YEAR of bad crops and that will be the year the world goes to war again.
cared. Some of US have warned for years, and my warnings to family and friends predates my time on TB by 7 years, that the bubble was the largest in human history, and it had to pop.
Here on TB, the majority view was (don't care) or TOO BIG TOO FAIL, the world 'can't afford' to let the dollar crash.
You could throw all the history at them you wanted, steep denial was in effect for the last several years, with almost all members.
Here it is. Too Big to Fail is simply too big to keep up.
2-6 months of faltering T bill sales or no sales will lock up the Federal Government. Mass layoffs and mass business closings will further impact tax collection of millions upon millions of workers, and hundreds of thousands of businesses.
End badly? Wake up, you and everyone you know are in for about 10 years of hell. and most likely world war.
I am not sure the climate is going to cooperate for another 10 years myself though. One year, ONE YEAR of bad crops and that will be the year the world goes to war again.
"...Obama is not even President yet, and he is failing miserably..."
As I think that his supporters at least, want a completely controlled economy, I would say, from their view point, he is doing quite well. Because we going to have a completely controlled economy where there will be a place for everybody, everybody will be in that place, and any pushy people who try to get out of their assigned place will be dealt with, very harshly.
Better check your seat belts. You are going to need them if O gets his way.
As for China, as foreign trade slows, foreign investment slows, the Lesser Classes get more and more restless because their jobs are disappearing and they ain't about to go back to the farm (I have had Chinese tell me there ain't no farms there any more, they now have to import food), the whole system could easily collapse into chaos.
As I think that his supporters at least, want a completely controlled economy, I would say, from their view point, he is doing quite well. Because we going to have a completely controlled economy where there will be a place for everybody, everybody will be in that place, and any pushy people who try to get out of their assigned place will be dealt with, very harshly.
Better check your seat belts. You are going to need them if O gets his way.
As for China, as foreign trade slows, foreign investment slows, the Lesser Classes get more and more restless because their jobs are disappearing and they ain't about to go back to the farm (I have had Chinese tell me there ain't no farms there any more, they now have to import food), the whole system could easily collapse into chaos.
China Connection
TB Fanatic
China still has farms everywhere possible.
China still has farms everywhere possible. Importing food is probally mostly grain for feeding livstock. Like the West China is now very much into meat eating where as before they mostly ate vegetables. I think they will be eating vegetables again soon.
I expect to see movement get restricted here in China soon to stop unrest. It is not a hard thing for the government to bring in here as everyone has an ID and there are toll ways everywhere.
I would rather be here in China in hard times than back home in Australia in reguard to safety. It used to be unsafe in the countryside before and this condition will return I'm afraid but overall I think it will be safer then in my home country.
China still has farms everywhere possible. Importing food is probally mostly grain for feeding livstock. Like the West China is now very much into meat eating where as before they mostly ate vegetables. I think they will be eating vegetables again soon.
I expect to see movement get restricted here in China soon to stop unrest. It is not a hard thing for the government to bring in here as everyone has an ID and there are toll ways everywhere.
I would rather be here in China in hard times than back home in Australia in reguard to safety. It used to be unsafe in the countryside before and this condition will return I'm afraid but overall I think it will be safer then in my home country.
Last edited:
imaginative
keep your eye on the ball
Well- a good war ought to stimulate us and the rest of the world out of this global depression that is on the horizon.
O sh**, we've got a anti-gun, globalist, pacifist marxist playing Commander-in Chief. This cannot possibly end well.
O sh**, we've got a anti-gun, globalist, pacifist marxist playing Commander-in Chief. This cannot possibly end well.