22 Sep 07
1 edit
Originally posted by PalynkaWhile you are correct that the Chinese do hold a greater portion of US debt than Euro debt, if you will check the numbers, they are quietly gobbling up Euro debt as well. That is why the Euro economists are scared to death and watching what happens to the USD, because if the USD crumbles, the Euro will also crumble shortly thereafter. That is why it becomes paramount that the Euro and USD have to support each other to avoid a world market collapse. The middle east players right now appear to be the critical cogs in all of this. If they dump to the chinese, you may want to start learning the language.
They don't have anywhere near enough reserves in EUR denomination to dump the Euro. The US, however, is a different matter. Not only their reserves in USD are much higher, a high increase in USD volatility may eventually trigger the change towards the EUR as the main international currency. This means that the potential for the USD to fall is much higher tha ...[text shortened]... ts. Higher financial asset returns can delay the adjustment, but returns seem to be converging.
22 Sep 07
Originally posted by shortcircuitThe problem for the Euro is appreciating too much. Appreciation increases all your assets value in terms of other currencies, but makes your products less competitive.
While you are correct that the Chinese do hold a greater portion of US debt than Euro debt, if you will check the numbers, they are quietly gobbling up Euro debt as well. That is why the Euro economists are scared to death and watching what happens to the USD, because if the USD crumbles, the Euro will also crumble shortly thereafter. That is why it bec ...[text shortened]... l cogs in all of this. If they dump to the chinese, you may want to start learning the language.
The fears you are talking about are of a "too strong" Euro, not about China being able to dump it. If the USD falls abruptly, that's exactly what will happen, and it's not good for anyone.
22 Sep 07
Originally posted by PalynkaWhat you are saying is true in principal, but the problem will be that the Chinese would control a huge portion of production because they would undermine the pricing structures everywhere. Once they have have the world' production controlled, then the will wield incredible power and will control all facets of the world economy. Unfortunately, they have the necessary population to furnish the work force, they have the financial strength to support it, the key is whether they can get the rest of the world to foolishly allow them to get it done.
The problem for the Euro is appreciating too much. Appreciation increases all your assets value in terms of other currencies, but makes your products less competitive.
The fears you are talking about are of a "too strong" Euro, not about China being able to dump it. If the USD falls abruptly, that's exactly what will happen, and it's not good for anyone.
22 Sep 07
Originally posted by reinfeldok, you have a point there...
..chinese culture is materialistic to the core ( in spite of the burp of confucius and communism )...self-interest is the one thing you can always depend on with the chinese ( i know them well )...this is not to say something offensive..it is just a clear observation...they have no ability to
give allegiance to something outside their household or clan for ...[text shortened]... a fragmented state of conflict within a common border which the world has called "china"...
but let's say that now the Chinese have their allegiances to the communists...
who is to say that they will crumble BEFORE screwing up the world economy?
what if china expands globally and then collapses...
we will all be in a modern sense of post Roman Empire Europe
22 Sep 07
Originally posted by shortcircuitWe've heard that one before with Japan, remember?
What you are saying is true in principal, but the problem will be that the Chinese would control a huge portion of production because they would undermine the pricing structures everywhere. Once they have have the world' production controlled, then the will wield incredible power and will control all facets of the world economy. Unfortunately, they have ...[text shortened]... , the key is whether they can get the rest of the world to foolishly allow them to get it done.
Don't worry, it will be fine.
22 Sep 07
Originally posted by rubberjaw30That is irrelevant, because the flaw of the argument was that there isn't a fixed number of jobs to go around. And particularly since the US doesn't specialize in building cheap industrialized goods, all China is doing is decrease the cost of imports for the US.
incorrect...
Japan didn't have nearly the workforce of china
The only major problem for the US is if the dollar plummets.
22 Sep 07
Originally posted by Palynkaas a side note, is it also irrelevant that the Russians are supporting the Chinese?
That is irrelevant, because the flaw of the argument was that there isn't a fixed number of jobs to go around. And particularly since the US doesn't specialize in building cheap industrialized goods, all China is doing is decrease the cost of imports for the US.
The only major problem for the US is if the dollar plummets.
supposedly, the Russian economy is growing due to increase in oil prices combined with the fact that Russia exports oil
old news: they are using these economic gains to increase military power, with long range bomber runs and new weapons tests...
supposedly, they tested a CONVENTIONAL bomb more powerful than the bomb dropped on Nagasaki or Hiroshima
22 Sep 07
..the russian convential bomb is a device for destroying underground targets...putin just blew it off in order to feed the nationalism of the russians who need a little shot in the arm these days...it is just a very big
hot firecracker...the biggest yet built...not really an item for warfare as we
normally understand it...but a very nice photo op...
22 Sep 07
Originally posted by rubberjaw30What are you saying here? Should we try to prevent them from growing so they can't spend on military?
as a side note, is it also irrelevant that the Russians are supporting the Chinese?
supposedly, the Russian economy is growing due to increase in oil prices combined with the fact that Russia exports oil
old news: they are using these economic gains to increase military power, with long range bomber runs and new weapons tests...
supposedly, they tested a CONVENTIONAL bomb more powerful than the bomb dropped on Nagasaki or Hiroshima