China Severs Its Currency's Link to Dollar

Nobody left to loan the neocons any more money for their deficits it seems. Now they will call the loans due.

And you're sure about this about as sure as you have been about everything else, right?

What do I get when you're proven to be an idiot again as you always have been?

ral

Cliff wrote:

Cliff wrote in news:4h10e1dro8n9g08eojpu7q6scknsulfico@

Hmmm. The Cinese are going to take a 2%+ hit on hundreds of billions of dollars just to make everyone happy. I'm sure they'll keep on loaning us money to buy their cheap crap. What other choice do they have? Europe is an economic black hole, and they aren't likely to open their markets up to cheap Cinese goods.

Cliff wrote in news:h070e19ojd6ca560l2ojtnvkgu4filh9g6@

Another clueless hand wringer with no grasp of economics.

He has been writing this drivel for almost thirty years. Has he ever been right about anything?

You would think if you just guessed you'd be right half of the time.

The EU is currently a bigger market for Chinese goods than the US (but the US is a somewhat bigger market than Japan).

Best regards, Spehro Pefhany

Let's be realists here. Blaming or not blaming any political group should only be done after arriving at good understanding of what is going on.

What is going on is that the United states is running irresponsible, banana republic style finances, with relatively large budget deficits, low interest rates, and very large foreign trade deficits.

Partly, these consequences are already apparent in the rise of various real costs (fuel, housing, etc), which are probably not by accident, not included in the "core rate of inflation". The present system for calculating CPI is very creative and excludes pretty much every component that shows substantial price inflation. So it hides reality to some extent.

Ultimately, banana republic style finances will lead to banana republic style consequences. Lenders cannot continue lending money to the US on current terms indefinitely to finance these deficits, so something will have to change to restore trade equilibrium.

Given the difficulty of reducing deficits in the present situation (a hopeless expensive war, plundering of the budget to pay off various constituencies etc), I cannot see anything other that fall of the value of the dollar as being able to address the disequilibrium.

Consequently, I and my family bought a sensible quantity of euros back in 2003.

I am not terribly interested in who is to blame, although it is impossible not to recognize that the present administration made an unforced decision to become involved in an unneeded, expensive foreign misadventure, as well as reduce taxes to those who supported it financially. Something that is not affordable to the society in the present deficit environment.

I would not support a contention that one political party in the US is substantially less inclined towards thievery.

If you don't recognize who's responsible for the mess, then there's no hope of fixing it. This is like saying, "oh well, one of the kids crashed the family car. Let's not point fingers and fix blame."

Wrong.

We *need* that car. We *need* to find out why they can't drive, and make sure they don't get behind the wheel until they prove they're skilled and responsible. And until they've paid off the damage they've done.

Otherwise they're just going to keep right on destroying the family property.

Basically we have a bunch of out-of-control drunk teenagers running our country's fiscal matters.

Jim

That's something I agree with. In this thread, there was too much focus on blaming as opposed to trying to understand what is going on, and that's what I tried to correct.

The idea sounds attractive, but why do you trust European politicians more than US politicians? Maybe Swiss Franks or gold?

They have much better financial track record, lower deficits, etc.

I have no opinion on relative merits of swiss franc vs. euro.

As a proud neocon, I think we neocons need to have a raffle or something so that Cliff could buy a brain. Any thoughts Gunner ? Heh Mark

Richard Lewis wrote:

lol

ral

Marc wrote:

What? Destroy the planet's most perfect vacuum?

No Way!

Gunner

"Considering the events of recent years, the world has a long way to go to regain its credibility and reputation with the US." unknown