Don't you love it?....

Discussion in 'Economics' started by dhpar, Sep 18, 2008.

  1. dhpar


    i find it ironic that communist china is teaching usa a lesson in capitalism. or is it?

    it is clear that china by supporting week yuan:

    1. bought treasuries from export windfalls
    2. pushed US interest rates down
    3. this caused excessive risk taking causing ultimately a collapse
    4. now china is buying US financial system and commodities resources from profits from those treasuries.
    5. this ultimately pushes US interest rates up while redistributing economic/geopolitical power to china.

    but wait - this increases US savings and productivity, improving trade balance...starting the whole cycle again (in favor of US) - lol.