Posted on 11/27/2004 10:24:13 AM PST by soccer_linux_mozilla
The United States’ trade deficit is soaring and the once high-flying dollar has sunk to record lows against Europe’s common currency.
The dollar’s record low against the euro coincided with the government’s report that the United States was running a trade deficit through September at annual rate of 592 billion dollars. That compares with last year’s record 496 dollars billion. As a result, the country is having to borrow almost 600 billion dollars from overseas this year to pay for the imported cars, televisions and other items Americans are buying.
Well if you cease to produce as a nation, you will cease to be a superpower.
Wow. You want industrial subsidies to go along with agricultural subsidies, while supposedly championing "small government."
BTW, the current slide in the value of the dollar can be traced to the actions of a certain Bush-hating palindrome-surnamed currency speculator.
Zowie! I had no idea I was saying that-- thanks for the heads up because I'd never have known that without your help. Ok, I was wrong to advocate run away inflation and I really do apologize; please give me another chance. What I'd really like to get across (and maybe you can help me a bit on the right wording) is something to the tune of how nominal prices are all well and good, but what matters more to me is whether or not we die because we can't feed ourselves.
IOW, food prices and wages both go up or down. As long as wages end up higher than food we don't starve. Our Creator has blessed us with prosperous times; i.e. more and more people can feed themselves with less effort than was possible in past generations. Normally I love complaining as much as the next guy, but maybe in this case ingratitude would a sin.
I agree with the manufacturers. The graph shows that we want a dollar trading like it did during the economic expansion of the '90's, and not like it's been trading during the recession of '01- '02..
THis would be direct national defense against a foreign national governmental attack upon our country. Only government can counter government. We would merely use our diplomatic levers, i.e., whatever it takes, to get them to stop what they are doing via GOVERNMENT INTERFERENCE.
We need to play hardball. No more Mr. Nice Guy.
Actually, it is...and if China really IS subsidizing things, then they're losing money.
Sheeesh! Whatever did they teach you Marines at Quantico?
I didn't go to Quantico. I worked for a living.
Nope, again you get it wrong, as they treat this as just the cost of business. And in dollar flows, they aren't losing anything. Not while we prop them up with investment flows and the $600 billion trade imbalance. They have $500 billion hoarded. They "invest" $120 Billion annually in stupid currency manipulation to keep the "peg" against the dollar fixed. Are you so monomaniacal as to deny that they are doing that? You are aware that a ton of economists have confirmed it is in fact happening. And what do they get out of these "subsidies" which in fact do nothing to help our industry...just our consumption of THEIR stuff?
They get our industry.
If we just DEMANDED that if they wanted to continue trading with us, that this $120 billion annually be spent on our manufactures (cars, tires, ships, planes, semiconductors, hard drives, new machine tools, etc.), or forget it, they are embargoed... that is NOT subsidy. It is a government response to the malicious conduct of a foreign government.
You have been consistently wrong about the Chinese economy. You were wrong about their "banking crisis". They do just throw $100 billion or so into the "failed" banks every 4 years, just like we saved CitiBank. Likewise, you are wrong about their intentions to make these industrial relocations...PERMANENT.
Whose side are you really on?
They're still losing money.
And in dollar flows, they aren't losing anything. Not while we prop them up with investment flows and the $600 billion trade imbalance.
They're losing money right now, which is why they're screaming bloody murder about the falling dollar.
They have $500 billion hoarded. They "invest" $120 Billion annually in stupid currency manipulation to keep the "peg" against the dollar fixed.
And now they're screaming bloody murder, because their policy of fixing their currency to ours just started biting 'em in the a$$.
Are you so monomaniacal as to deny that they are doing that? You are aware that a ton of economists have confirmed it is in fact happening.
Yeah, it's happening.
I like it when my opponents do stupid and useless things. It means that they're wasting an opportunity to do something that will really hurt me in the long run.
And what do they get out of these "subsidies" which in fact do nothing to help our industry...just our consumption of THEIR stuff?
They get enough cash flow to service some bad loans.
If we just DEMANDED that if they wanted to continue trading with us, that this $120 billion annually be spent on our manufactures (cars, tires, ships, planes, semiconductors, hard drives, new machine tools, etc.), or forget it, they are embargoed... that is NOT subsidy. It is a government response to the malicious conduct of a foreign government.
It's a subsidy. The subsidization would be indirect, but it would be very real. It would be as much of a subsidy as the federal government telling you that you must buy $X of American-made goods, or that they'd forbid you to work.
Is that your position? That it is only hypothetical? Mythic? And the Yuan just stays pegged by magic? Some "invisible hand"?
Never mind the extremely "visible hand" of Bejing...pay no attention to that man behind the curtain...
And I'll repeat: You're clueless.
Economic growth is not deflationary. Office rental prices do NOT deflate just because you have a hot economic zone. Home prices do not decline in economic boom towns (look at Vegas, please). Salaries do not decline when your company is growing.
In short, where you see economic growth you see very little deflation, save for very efficient finished products.
If it's really a subsidy, then it's eating away at China's profit margin, which is already razor-thin.
You cannot subsidize low-margin manufacturing without...LOSING MONEY!
"That's your test, and there is no factual basis to it." - Moonman62
On the contrary, the factual basis behind that test is called: reality.
To illustrate the concept, simply consider a narrow test case of two island nations trading only with each other. When one exports more to the other than it imports, it will have a surplus of the currency from the other island.
Do you know what a surplus does to supply and demand and price?
Answer that question and then you'll finally be in an intellectual position to consider the initial currency test mentioned above.
And if they are in fact not-so-stupid, but way ahead of you...as you don't know what they intend once they have debased our industrial capability...
Just what are you going to do when you realize what they are up to and have finally seen the checkmate 3 moves ahead...
They're still losing money.
It's only money. Paper IOUs. They are playing for keeps.
No. Japan isn't "cooperating." Japan is *opposed* to letting the Dollar fall (it makes Japanese exports to the U.S. too expensive). Where do you people come up with such wild-eyed "theories" as Japan cooperating with the Dollar's decline?
Greenspan warns Japan against currency intervention
Wednesday, March 3, 2004 at 08:00 JST
NEW YORK — U.S. Federal Reserve Board Chairman Alan Greenspan issued a warning Tuesday against Japan's continued massive currency market intervention aimed at stemming the yen's appreciation against the dollar.http://www.japantoday.com/e/?content=news&cat=3&id=290378
Oh my God, what WILL we do when they cut off the supply of pet chew toys?
We still have a massive industrial capacity.
In the meantime, we are helping the PLA to become a mercantilist army dominated by businessmen-in-uniform instead of a warfighting army dominated by those who can actually fight wars.
Just what are you going to do when you realize what they are up to and have finally seen the checkmate 3 moves ahead...
The ChiComs are only a few moves away from reaping the "blessings" (heh-heh-heh) of totalitarianism--namely, societal collapse.
My guess: by 2020, we'll be reestablishing the Yangtze Patrol to defend American trade interests against the predations of the Japanese and the EU.
Really? Precisely where is it?
"Don't you think they have a bit of a conflict of interest?" - Moonman62
Since when is putting America first a "conflict of interest"?
Across the fruited plain.
Not an answer.
Tango Sierra, Delta Alfa.
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