Posted on 03/22/2008 9:41:31 PM PDT by manilaman
True. But some Red Chinese stuff is total crap. You get what you pay for.
On the other hand, my Red Chinese made ThinkPad R61 upon which I am typing is the best laptop computer I’ve ever owned...
Like I said, I would love to think that it’s all some master plan that’s working perfectly!
I have my doubts whether the folks in DC are really that smart though. Maybe we’re just lucky.
From the article:
>>If China keeps it currency at its present levels, the United States will buy less<<
And then what? Just try to find things at Wal Mart that are not made in China. (Last time I looked, Pyrex measuring cups were made in the USA but they are the exception.) I don’t think that US manufacturers are going to be able to start producing in time to compete.
Perhaps other Asian nations will undercut China’s prices, but I doubt they are strong enough to make much of a difference.
Yes i am the author and thanks for all the comments as my purpose is to hopefully generate some thinking and discussion.
I am a stockbroker/financial consultant for the last 30 years and a published ‘pundit’ for more than a decade. This post is a reprint from my twice-weekly column available at http://businessmirror.com.ph/.
Two points of clarification/amplification: “This time, the “crisis” is being used to further the US economic position”. Therefore it is not a case of pushing the US into recession to hurt China but to use the crisis to accomplish a larger goal. Note: Chinese exports to the United States fell 5 percent in February, to $16.4 billion, while imports of American goods jumped 33 percent, to $6.1 billion. And guess which country has a higher inflation rate?
There are several options to deal with the crisis. However, a devalued dollar particularly targets China. Remember, the Fed FIRST pumped billions in to the system(dropping the dollar even more), before the bulk of the interest rate cuts was instituted.
Secondly, in my 20 years of currency trading, i have never witnessed a time when the US Admin said they wanted a stronger dollar and then failed to take any action to strengthen the dollar.
Ostensibly, all the Fed action is to ‘attack’ the housing/credit crisis. That is nonsense. In comparison to the size of the economy, the S&L failures was a much greater financial problem. If bad mortgages are the problem, then simply set up a current equivalent of the Resolution Trust Corporation.
But the broader picture is not just about China.
The US is an agricultural economy based on our exports. European agricultural subsidies have now become either less effective or more expensive.
American assets are much cheaper to buy and foreign money is flowing in. Remember when Japan used a weak dollar to buy everything they could from the Rockefeller Center to Columbia pictures? And how much money did they eventually lose on those transactions?
And finally, in the real world, the fact that the US carries such a large foreign debt burden and the worry that it is a potential weapon against the US is, in my opinion, unfounded. The fact is that the US is the only economy that is large enough to absorb all that excess cash. China and the world needs to buy US debt, unless of course they intend to put hundreds of billions of dollars under their mattress.
It is fashionable to think that Washington and big business is filled with stupid, incompetent people. Partially true:most of the Democrats are. Underestimate the financial power of the US and its government at your own risk.
Sure, this is my opinion and assessment of the situation and is an opinion based in part on the fact I have been in southeast Asia for 20 years.
Should read: Opec Wages Jihad on Dollar
man, i have been called many things over the years, but “planted diversion??”. i suggest you look at this Dollar Index chart from 1972 at http://www.chartsrus.com/chart.php?image=http://www.sharelynx.com/chartstemp/free/chartindCRUvoi.php?ticker=FUTDX
You will notice two important points of reference: jan 2002 and jan 2006 as pivot points as we say in technical charting analysis, for the dollar decline. as for saddam, that occurred in 2000 and the dollar appreciated 20% after that.
But if conspiracy theories are of interest, this one will appeal. www.endtimeprophecy.net/EPN-1/Articles/Articles-Poli/eurowar2.html
Saddam Announced his decision in 2000, after the invasion by 2003 Iraqi Oil was again being sold in dollars. During that time 2001to 2003) the feds were still lowering rates, so why is the dollar rising at that time? (because the vast iraqi oil is once again priced in oil...?)
In the other pivotal point: 2006, that's when Iran announced its Euro based Oil Bourse (exchange) to compete with Nymex. In addition, Iran instructed Japan that they will not accept dollars for oil exported to Japan. Since then it's been all downhill for the dollar, yet the fed was still raising rates in 2006, and part of 2007, so what gives?
It appears that Opec is having more of an effect on the dollar than anything the fed does.
“The US is an agricultural economy based on our exports. European agricultural subsidies have now become either less effective or more expensive.”
Total BS. US impose agricultural subsidies just as Europe does.
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