http://www.ustreas.gov/press/releases/hp1138.htm The July Treasury capital flow report clearly shows that the bloody foreigners have ceased buying US debt. God knows what August and September are going to look like. You just cannot trust a foreigner these days. I suppose the Fed will step in and put a tax payer finger into this leaky hole as well all the others, plus those yet to come. Via los tax payers and their yet to be borne great grand children. Quite frankly if this carries on much longer the Kalifornicans will need to start yet another new lifestyle trend ... "living within your means" regards f9 Buenos Aires / Rio de J
Maybe we are tired of financing "Birdbrain" and his rotten war. Let alone propping up the US economy. Will there be any penalties on the culprits of this latest crash ? Well maybe a small reprimand here and there ?
You people get upset when they come here in person and upset when they don't send their money here. What do you want???
I am just trying to alert people to what might well be the next phase in this game, or there may well be another phase in between. Already US Banks are now permitted to carry more favourable goodwill capital terms enabling them to reload their ratios beyond the normal capital asset requirements. (basically goodwill = cash as a basis to further support lending) Next they will be borrowing against goodwill from the Fed (US tax payer) The grave danger in deficit governance (imo) is that foreigners (creditors) do not need to sell, they simply need to stop buying in order to devalue the debtor'sassets. But are they not shooting themselves in the foot. No, they are chasing dollar denominated devalued assets on their terms, not yours. Watch how this game plays through. Anyone how thinks that US military will save the day is in for a big shock followed by a big lesson. There is a story doing the rounds that Boeing has been cleared to sell Israel 1,000 bunker busters ... cannot imagine what they will be used for. At the same time Iran has announced their version of the Bush doctrine if attacked. (for Sarah's enlightment, it means take the play to the enemies home turf) If you want my opinion, living life as a debtor, be it as an individual or a powerful military gov, is a very unsatisfactory way to live life. Every decision taken is always dominated by debt and so clarity of thought goes out the window.... all very very unsatisfactory regards f9
What did the foreigers do that you can't trust them? Let's see: 1) They've been working like 100 hours a week and send you cheap clothing, shoes, electronics ...etc and receive a piece of US IOU paper in return for the last 10 or 20 years. 2) During that time they saw the value of their hard earned money fell by 50% because US debase their currency. Basically the US is repaying 50 cents on the dollar in real term. 3) On top of that the US lowered the interest rate and the IOU they own now return only 2 or 3% which is negative interest in real terms after inflation. 3) So what do they do with the paper? They tried to buy some real goods such as a bank or an oil company to protect some of the value but the US says no you can't buy that. The US was telling them what the can do with their money. 4) Then the US government now says hey I need another 5 trillion to bailout Fannie and Freddie. I need to borrow another 5 trillion from you on top of the previous 10 trillion debt. I'm going to continue to debase the currency and giving you negative real interest rate and no you can't buy anything real from the US. So if you were the foreign government what do you do? You would probably say no thank you right?
The impact of your statement is mind boogling ..... it basically means that the Fed will need to monetarise the debt ... I cannot even get my head around it Now, what happens if US citizens wake up and stop spending. Already this year the inflow of TEUs (containers) is dropping, especially right now as Retailers are landing their Christmas stock. 72% of US economy is carried on the consumers backs regards f9