Trade is great, I am all for it but that's not really trade if we buy from them and they don't buy from us.
It's going to be fun watching this psycho Chavez take Venezuela over the falls. Another typical puppet South American dictator...
. Jayford: As for Brazilian debt being repaid so quick; yes, they have done a wonderful job. This has only been possible due to high commodity prices though. If commodity prices come back down, which they will of course as its all cyclical, Brazil is going to be in trouble. The economy there is too dependent on raw exports. ***** SouthAmerica: Brazilian debt has been repaid so quickly â not only because of high commodity prices, but also because the US dollar has declined a lot in the last 2 years against the Brazilian currency and became cheaper for Brazilians to repay debt in US dollars. Commodity prices should stay high in the coming years because of high demand from China and India. ****** dddooo: They could always dump their exports in the ocean and print their own green paper as opposed to dumping their exports in the US in exchange for green paper printed by Greenspan/Bernanke. What's the difference? ******** SouthAmerica: China will continue investing in the US at least for a while longer â The real deal is they keep pilling up US dollars ( most likely they will use it as wall paper in the future) in exchange of millions of good paying US jobs. In one hand the Chinese will take a huge beating in the future related to their US dollar investments, but in the other hand they will provide good jobs for millions of Chinese people. (When a country has over 1.3 billion people they will do anything to create new jobs for this massive number of people. ****** PoundTheRock: It's going to be fun watching this psycho Chavez take Venezuela over the falls. Another typical puppet South American dictator... ****** SouthAmerica: Chavez has been helping a lot the poor population of Venezuela (at least 80 percent of the population) â he is giving them education, subsidized food, and healthcare. The people in Venezuela love him. Besides all this escalation between âIran and USâ and between âVenezuela and USâ it is more a result of the US government getting desperate regarding oil supplies. .
. Nononsense: Ya make it sound like they got themselves another Fidel Castro. ****** February 7, 2006 SouthAmerica: There is a major difference between Chavez and Castro â Venezuela has a lot of oil and money. .
What I've said all along. These lefties believe the export nations will somehow be untouched if the US stops buying their exports. Who is going to pick up the demand? France? Germany? China? What is even more frightening is that SA is a published writer and there are probably a fair amount of people that believe his analysis. Truly frightening indeed. QUOTE]Quote from Jayford: Hmm? How anyone here thinks a US failure wouldn't greatly screw the ROW (Rest of World), is completely beyond me. US consumption drives the World economy, hence the huge deficit in balance of trade. One previous post stated that China is self sufficient, so no big deal if US collapses. Sorry, but China's economy is based on exports. Yes, they export to many countries, but many of those countries also are dependent on US trade. US "borrowing". No one is forcing other countries to buy US debt. They make this decision on their own for two reasons. A) best place to put their money. B) To prop up their own currencies so the US can keep buying from them. If the US stops buying, exporters know they are screwed. As for Brazilian debt being repaid so quick; yes, they have done a wonderful job. This has only been possible due to high commodity prices though. If commodity prices come back down, which they will of course as its all cyclical, Brazil is going to be in trouble. The economy there is too dependent on raw exports. I personally love the Country, and can't wait to go back, but Brazil has several of their own, very serious problems. Jay [/QUOTE]
What is truly fightening is your logic not SA's post. You as well as many others seem to have a very perverted view on the economic cycle. It goes like this savings-> investments-> production->consumption.As Hayeks puts it as long as an economy consumes more than it produces real economic activity would decline. All else is keneysian socialist delusion. A big delusion among americans today seems to be the idea that Chinese need the US consumer and that if the $ loses most of ots value China would suffer more than America. What you fail to see is that the world economy functions like a big auction. For instance if a brand new flat screen TV costs 1000$ today the average Chinese cannot afford because his salary is about 200$ per month unlike the average Joe in the US who has a salary of 2000$.If the $ crashes from 1$:8.2 Yuans to 1:1 suddenly the chinese worker is making 1600$ while the average US worker is still making 2000$. So the Chinese would now be able to afford the goods he produces. Same goes for the chinese government they might get screwed on their USD reserves but their yuan position, which is BTW much larger, would more than compensate for the loss since the yuan would buy much more goods and assets. What the Chinese do now is equivalent to dumping their production in the sea while People's Bank of China distributes them Yuan. Countries as well as individuals dont trade for the sake of accumulating paper money they trade for goods and services. The only reason this is still happening is inertia. The world still thinks of America as the highly productive,competitive economy of the 50s-60s-70s wich was the world's greatest manufacturer and low cost exporter. These days unfortunately for the US are long gone what we have left is a service economy with wedding planners and lawyers. It would take some time for the world to catch up with that fact but eventually it will happen. And with the huge twin deficits in excess 1.5 trilion $ one can assume that it will happen sooner rather than later. The US of today reminds of the USSR in the 80s. Hyperinflation is an amazing economic phenomena. I made a lot of money on the russian default and subsequent hyperinflation as well as on the argetnian crisis.
"Why The Economy Is A Lot Stronger Than You Think" http://www.businessweek.com/magazine/content/06_07/b3971001.htm
. February 7, 2006 SouthAmerica: In the last week of January 2006 during the Davos World Economic Forum The New York Times published an article on January 27, 2006 by Floyd Norris âWin â Win? Tell It to the Losersâ. Quoting from that article: "Davos, Switzerland â World Economic Forum â¦Elaine L. Chao, the United States labor secretary, said the job outlook in the United States was bright for plumbers and electricians." ***** SouthAmerica: According to the current US labor secretary the best the United States can perform today is to create jobs that canât be exported to other countries such as jobs for plumbers and electricians. It is frightening to realize that this is the best that the US economy can do today. Finally, it seems to me that the United States is declining to an economic level of a Somalia, a Sudan, and many other African countries since these countries are also capable of creating jobs for plumbers and electricians. .
"Greenspan was continually digging into arcane factoids he hoped would give him a better insight into what was going on under the hood of the U.S. economy. And Bernanke seems to understand the importance of doing the same. In a speech last year, he said that intangible investments "appear to be quantitatively important." As a result, Bernanke noted, "aggregate saving and investment may be significantly understated in the U.S. official statistics" "By the early '90s, Greenspan was becoming increasingly frustrated by the official numbers' inability to explain a rapidly evolving economy. In 1996 and 1997 he refused to accept conventional data telling him that productivity growth was falling in much of the service sector, noting -- correctly, as it turns out -- that "this pattern is highly unlikely." He also pointed out that the official numbers for consumer inflation were too high." -from the article. This to me looks like monstrous attempt to rationalise the US buble economy instead of adressing the issues. I especially enjoyed the idea that CPI understates inflation and that productivity was not measured correctly. Ha what pimps.