I agree with Catalite's comments that currencies are a zero sum game. The US isn't the only country having a lot of problems with its financial system and being very slow to recover. There's no reason to believe that the USD won't get stronger. As for manufacturing, well thank God that everyone realizes the manufacturing crisis BEFORE the US ceases to produce anything. I've read numbers that something like 40% of all manufacturing in the US was lost in the last 10 years.
Manufacturing JOBS have been lost, not manufacturing OUTPUT (even so as a share of global GDP). Contrary to popular opinion, the US is still a global manufacturing powerhouse, thanks to productivity increases (read: firing the lemmings on the low-end spectrum of the value chain, outsourcing to emerging economies).
Makloda, you wouldnt happen to know the contribution of the 2 million people in US jail to the manufacturing output would you? Just wondering if there was any data available on that. Thanks.
this is not exactly the scenario for companies to invest in plant and equipment.which leads to productivity gains and a strong currency. it is currently a race to the bottom between these two currencies plus the euro. the emphasis is on the word currently. http://www.nytimes.com/2010/02/26/business/26procure.html?scp=1&sq=government contracts&st=cse The Obama administration is planning to use the governmentâs enormous buying power to prod private companies to improve wages and benefits for millions of workers, according to White House officials and several interest groups briefed on the plan. By altering how it awards $500 billion in contracts each year, the government would disqualify more companies with labor, environmental or other violations and give an edge to companies that offer better levels of pay, health coverage, pensions and other benefits, the officials said. Because nearly one in four workers is employed by companies that have contracts with the federal government, administration officials see the plan as a way to shape social policy and lift more families into the middle class. It would affect contracts like those awarded to make Army uniforms, clean federal buildings and mow lawns at military bases. Although the details are still being worked out, the outline of the plan is drawing fierce opposition from business groups and Republican lawmakers. They see it as a gift to organized labor and say it would drive up costs for the government in the face of a $1.3 trillion budget deficit. âIâm suspicious of what the end goals are,â said Ben Brubeck, director of labor and federal procurement for Associated Builders and Contractors, which represents 25,000 construction-related companies. âItâs pretty clear the agenda is to give big labor an advantage in federal contracts.â Critics also said the policy would put small businesses, many of which do not provide rich benefits, at a disadvantage. Furthermore, government officials would find it difficult to evaluate bidders using the new criteria and to determine whether one companyâs compensation package should give it an edge, said Alan L. Chvotkin, executive vice president of the Professional Services Council, a coalition of 340 government contractors.
Bill Gross, head of the PIMCO hedge fund which has a trillion dollar assets under management shares some of Jim Rogers sentiment on the UK. http://europe.pimco.com/LeftNav/Fea...February+2010+Bill+Gross+The+Ring+of+Fire.htm Of all of the developed countries, three broad fixed-income observations stand out: 1) given enough liquidity and current yields I would prefer to invest money in Canada. Its conservative banks never did participate in the housing crisis and it moved toward and stayed closer to fiscal balance than any other country, 2) Germany is the safest, most liquid sovereign alternative, although its leadership and the EUâs potential stance toward bailouts of Greece and Ireland must be watched. Think AIG and GMAC and you have a similar comparative predicament, and 3) the UK is a must to avoid. Its Gilts are resting on a bed of nitroglycerine. High debt with the potential to devalue its currency present high risks for bond investors. In addition, its interest rates are already artificially influenced by accounting standards that at one point last year produced long-term real interest rates of 1/2 % and lower.
Yes, we export jobs, complicated financial products based on some algorithm, and we try unsuccessfully to export our bonds and treasuries.
There is no inconsistency here, since his theory of reflexivity is essentially that of a feedback loop. And that's what bubbles are about. Therefore, it only follows that he would attempt to exploit them while the getting is still good in his estimation. Remember, Soros is a market timer.
Off the Charts A Shift in the Export Powerhouses By FLOYD NORRIS Published: February 19, 2010 World Trade StumblesGraphic World Trade Stumbles In 1999, the top five exporting countries were the traditional industrial powers â the United States, Germany, Japan, France and Britain. Combined, they accounted for 43 percent of the exports reported by 40 large countries. As can be seen in the accompanying charts, a new order has emerged. China went from the ninth-largest exporter in 1999 to the largest in 2009. Germany, which passed the United States to become the largest exporter from 2003 to 2008, wound up in second place as the United States fell to third. Britain tumbled to No. 10, from No. 5. All told, the share of exports of the Big Five of 1999 fell to 34 percent in 2009. That loss of nine percentage points was matched by a similar gain for China, India and South Korea, with most of the gain going to China. Measured in dollars, Chinese exports rose at a compound annual rate of 20 percent through the decade. China even did better than most in 2009, when the combined exports of the 40 large countries fell by 21 percent. Chinaâs dropped by 16 percent that year. Among the top 12 shown in the graphic, the largest declines in 2009 â all of 25 percent or more â were recorded by Japan, Italy and Canada. The United States suffered an 18 percent drop. The 40 countries included in the tally are the largest ones for which figures are available through at least November. Among them, all but Belgium and Spain have reported December numbers. Their figures were estimated based on trends from September to November. Countries that report figures either annually or quarterly were not included. The largest exporters thus left out are mostly oil exporters, including Saudi Arabia. The figures cover exports of goods, not services. During the decade, American exports rose at a compound rate of a little more than 4 percent. That was far behind China and other emerging Asian exporters like South Korea (10 percent) and India (16 percent). But it was faster than Britain, Canada or Japan. Those figures are in nominal dollars, not adjusted for inflation. The gains would be different if measured in other currencies, like the euro or yen, but the order would be the same. There are indications of strong rebounds in exports as the world economy begins to recover. In December, American exports were 21 percent above where they had been in the same month of 2008, compared with Chinaâs 18 percent rise. Chinaâs exports were still much larger than those of the United States. Only a few countries, mostly in Asia, have reported January figures, but some of them showed explosive gains from the depressed levels of early 2009. Chinaâs exports rose 21 percent, but that paled in comparison to the 47 percent gain reported by South Korea and the 77 percent increase in shipments from Taiwan. A significant part of those gains may reflect the need to fill depleted inventories, rather than a surge in consumer demand. It remains to be seen whether world trade can return to the sustained high levels shown from 2003 through 2008, when exports of the 40 countries rose by more than 10 percent every year. Floyd Norris comments on finance and economics on his blog at nytimes.com/norris. More Articles in Business » A version of this article appeared in print on February 20, 2010, on page B3 of the New York edition. Times Reader 2.0: Daily delivery of The Times - straight to your computer. Subscribe for just $3.45 a week. Past Coverage * LETTER FROM WASHINGTON; Obama's Art: Threading the Needle (February 15, 2010) * OFF THE CHARTS; Recession's Silver Lining: U.S. Trade Deficit Is Down the Most on Record (February 13, 2010) * Latest Data Hints at a Recovery in World Trade (February 11, 2010) * THE CAUCUS; Obama's Balancing Act On U.S. Trade Policies (February 8, 2010)
not true. the US has successfully exported its bonds and short term papers. the fact that interest rates are low in the US is proof. interest rates will tick up when the chinese recognize the futility of US economic policy. yes they sold off US paper in december.