Now: Cold economic war
Me, again!
What I have noticed in the last few days regarding the Obama to Asia trip
is that the WSJ said that Obama was saying Asian dependence on the US for
export-driven economic growth was not sustainable (implying something like
that debt-based consumption of Asian exports can't continue). At the same time
the Financial Times (out of London) was saying that the Asians were basically
saying that Obama should continue to proclaim and support "free trade"
(meaning that they really like making money off the US and to hell with
our trade deficite). Now, today, the WSJ was saying that China gave Obama
the blowtorch in the ear that they are mad specifically at us for letting
the USD drop and that our deficit spending is to blame because big asset
bubbles are forming (and all our fault).
Reading between the lines and my own "partial" (incomplete) further
analysis suggests the following processes: yes, Fed caused lower (lower
than, say, Europe) interest rates is causing people to sell dollars and
buy Euros (maybe Yen, too, and all through "free market" currency
exchange processes) because both Yen and Euros have been going up the last
year or so by 20-30% (good ROI, and its been a linear increase over that
period) which it is understandable that any money-grubbing person would
pursue. So, China's (and anyone elses) holdings of USD is tanking in
value. But, if China is also selling USD (and keeping their mouth shut
about it, along with everyone else that is doing this, too), then they are
making money, off this process, too. I'm sure this is many hundreds of
billions of USD over that year.
But, all along, USD are getting cheaper by the day. I'm not sure, but I
have the notion that at some point USD are going to become so cheap and
Euros/Yen so valuable that all these "free market" rich guys (i.e. anyone
with gobs and gobs of money) are going to start net buying of USD and thus
buy, what, 30%+ more worth of USD with their Euros/Yen and then USD will
come up again. Possibly aided by intervention by the central banks around
the world, and the rich guys are going to make out like bandits.
China, now scolding the USA over what it sees as US "manipulation" of its
own currency (mainly by holding its interest rates down) and this is
helping our trade deficit as well doesn't want to let any attention be
focused on their pegged currency, and devalued (twice, by a lot) back in
early 1990s, and restrictions and blocking of foreign directed
establishment of business (taking the US for a ride the same way Japan did
many decades ago) in China. So, the WSJ had a sentence or two implying
that China/Asia had some kind of advanced look at Obama's speeches and as
a result there was, by implication and reading between the lines, some
agreement that Obama (and everyone else) would NOT mention at all anything
about currency! And, of course, China wants to leave their renminbi pegged
to the USD, and I also know that if the USD goes down, that also means the
renminbi goes down, too, and it was also shown in a graphic that all of
the other Asian countries devalued their own currencies to stay
competitive with China. Obviously, THEY want to keep exports up.
I've seen only a little speculation about China's own "stimulation" of its
economy by extending a large loan package to its business (so they went
into some kind of debt, too, just like every other country launched their
own stimulus packages) and where that is going to end up, some writers
think it might stimulate at least some inflation there, too. I'm not sure
it is necessarily good speculation. Articles say that exports out of Asia,
and in Asia are headed back up, and that Chinese domestic spending has not
increased to anywhere near what the economists (as if they have good
crystal balls) say is needed.
Articles are also saying that "free trade" deals are going on in Asia,
making all of THEM part of an economic "block" that they are saying is
going to leave behind the US (fine appreciative thought now that they made
a ton of money off us by sucking large fractions of our industries out of
the USA and into China, all along with the help of our CEOs and rich guys
who better like the idea of making money rather than nurturing the society
that helped them to begin to get rich). Somewhere in all of that
rationalization is the package of so-called liberal neo-classical
economics that promotes net profits and efficiency over any evaluation of
what this does, in the long run, to a society or economy (i.e. the USA),
but I think these economists are ignoring important parts of life.
I don't think cheap prices at Walmart are good for the long run for us,
but the best thing possible out of globalization is that interlocking
economies might help prevent wars (something almost never mentioned), but
as China rises and the US declines over the next, what, 1-2 decades as we
become totally de-industrialized, how is this kind of globalization a good
thing? All I see is cheap currency (weak currencies) countries killing the
USA. I don't have as good of a picture of what the comparable situation is
in Europe and Japan, but they also have some of the same problems (large
and growing imports from China).
Of course, I have not mentioned what is surely the US-based screw-up in
the financial markets with risky deals, derivatives, corporate crime
(including AIG and Madoff, plus all the other crap), and what seems like
mostly the US-only real estate bubble and all the controversy over
Obamacare and how best to get out of the recession/depression (give more
executive bonuses? Or cut their taxes?).
But, the rhetoric out of China the last few days sure looks to me like
cold economic warfare (hot rhetoric) along with ordinary economnic
warfare (eg. the currency devaluations of early 1990s). You can also find
articles on how China is also playing "protectionist" at the same time
putting the spotlight on some other issue as diversion. There was a very
small but very important WSJ article (Nov 5, 2009, page A14: entitled "US,
EU Complain To WTO About China) which said "Overall, the number of new
antidumping measures--tariffs enacted to discourage imports of goods being
sold below cost--rose to 281 in the year to June 2009, a 27% jump from a
year earlier. The biggest target: China." and that China was putting
_export_ tariffs (on raw materials), some quite high, and this represented
an illegal subsidy to their own companies.
Well, there are a lot of other secondary factors that I didn't talk about,
either, but still another WSJ article many weeks ago said that a poll of
economists said that 50% thought there would be US inflation (from the US
stimulus package) and the other 50% thought there would NOT be US
inflation from that stimulus package. Not real reassuring results, eh?, by
the "experts"? But, there are a lot of economists out there who are
bubbling over with how globalization "lifted millions out of poverty" but
they don't want to talk about all the ones that were pushed back into
poverty (eg. read Barbara Ehrenreich's "Nickle and Dimed").
Another article, today's WSJ, how many companies are showing vastly
improved productivity (like 20-30%) but only a few percent increase in
revenue (gross profits) and mainly by cutting costs (eg. cut employees,
cut employee wages, cut employee time per week). But, that's all "tough
luck" for the losers, eh?
Me, again!
See? No comments. Proof that nobody gives a shit about the important
things.
alexy
>
>See? No comments. Proof that nobody gives a shit about the important
>things.
Or that no one thinks your analysis (especially when partial and
incomplete) is important.
>
>On Tue, 17 Nov 2009, Me, again! wrote:
>> Reading between the lines and my own "partial" (incomplete) further analysis
>> suggests
<snip>
--
Alex -- Replace "nospam" with "mail" to reply by email. Checked infrequently.
alexy
>On Nov 17, 2:51�pm, alexy <nos...@asbry.net> wrote:
>> "Me, again!" <arthu...@mv.com> wrote:
>>
>> >See? No comments. Proof that nobody gives a shit about the important
>> >things.
>>
>> Or that no one thinks your analysis (especially when partial and
>> incomplete) is important.
>
>This newsgroup isn't much different in tone than the sort of
>conversations that a bartender has with drunk (or even sober)
>customers at a local bar or pub.
Sounds like an accurate characterization.
Antonio Huerta
> ... causing people to sell dollars and
> buy Euros (maybe Yen, too, and all through "free market" currency
> exchange processes) because both Yen and Euros have been going up the last
> year or so by 20-30% (good ROI, and its been a linear increase over that
> period)
I'd say it is bulshit. How can a currency go up 20% a year and make
someone buying it rich ? When you come to spend those Euros which
increased in value, and want to buy the goods, you will see that their
prices increased by the same 20%. No win.
But generally, I agree with the idea that the Chinese will lose when
the US dollar collapses because the Chinese hold all of their income
from selling the consumer goods to the US in the US currency paper.
The dollar collapses, and the Chinese's wealth will collapse, too.
From the other side, the US was recklessly printing dollars, and
paying the prices to the Chinese which the Americans could not pay
otherwise. If the Chinese could get something tangible out of their
current holding of the US dollars, then the Chinese clearly benefited
from the whole affair.
BMJ
>>
>>> See? No comments. Proof that nobody gives a shit about the important
>>> things.
>> Or that no one thinks your analysis (especially when partial and
>> incomplete) is important.
>
> conversations that a bartender has with drunk (or even sober)
> customers at a local bar or pub.
I've guzzled beer in some dives where the conversations in this newsgroup
would be a considerable improvement over the chatter of the remaining
clientele.
Old Pif
>
> What I have noticed in the last few days regarding the Obama to Asia trip
> is that the WSJ said that Obama was saying Asian dependence on the US for
> export-driven economic growth was not sustainable (implying something like
> that debt-based consumption of Asian exports can't continue).
>
Good. He obviously get it from src. We have been talking about that
for years.
> At the same time
> the Financial Times (out of London) was saying that the Asians were basically
> saying that Obama should continue to proclaim and support "free trade"
> (meaning that they really like making money off the US and to hell with
> our trade deficite).
>
That is fantastic. WallMart is not going out of business anytime soon.
>
> Now, today, the WSJ was saying that China gave Obama
> the blowtorch in the ear that they are mad specifically at us for letting
> the USD drop and that our deficit spending is to blame because big asset
> bubbles are forming (and all our fault).
>
That is also very good if he listen. Trips to Europe become terribly
expensive.
All good news. Thanks.
Me, again!
On Tue, 17 Nov 2009, morris croy wrote:
> On Nov 17, 11:50 am, "Me, again!" <arthu...@mv.com> wrote:
>> See? No comments. Proof that nobody gives a shit about the important
>> things.
>
> At this point, I'm resigned to the fact that I personally can't do
> anything about it.
>
I'd like to at least have a minimum understanding of what is going on,
and how it differs from what the propaganda says, and who knows maybe
there is something I can do about it.
Me, again!
On Tue, 17 Nov 2009, alexy wrote:
> "Me, again!" <arth...@mv.com> wrote:
>
>>
>> See? No comments. Proof that nobody gives a shit about the important
>> things.
>
> Or that no one thinks your analysis (especially when partial and
> incomplete) is important.
Or that the most that can come out of weak brains is nothing more than
weak comments....or....less....or...even none or almost none at all.
Still, its all still more additional proof of what I said about "nobody"
and "gives a shit."
Me, again!
On Tue, 17 Nov 2009, morris croy wrote:
> On Nov 17, 2:51 pm, alexy <nos...@asbry.net> wrote:
>> "Me, again!" <arthu...@mv.com> wrote:
>>
>>> See? No comments. Proof that nobody gives a shit about the important
>>> things.
>>
>> Or that no one thinks your analysis (especially when partial and
>> incomplete) is important.
>
> This newsgroup isn't much different in tone than the sort of
> conversations that a bartender has with drunk (or even sober)
> customers at a local bar or pub.
Can you really find sober customers at a local bar or pub?
Me, again!
On Tue, 17 Nov 2009, alexy wrote:
> morris croy <morri...@gmail.com> wrote:
>
>> On Nov 17, 2:51 pm, alexy <nos...@asbry.net> wrote:
>>> "Me, again!" <arthu...@mv.com> wrote:
>>>
>>>> See? No comments. Proof that nobody gives a shit about the important
>>>> things.
>>>
>>> Or that no one thinks your analysis (especially when partial and
>>> incomplete) is important.
>>
>> This newsgroup isn't much different in tone than the sort of
>> conversations that a bartender has with drunk (or even sober)
>> customers at a local bar or pub.
>
> Sounds like an accurate characterization.
See, even the "great" alexy has given up on alt.politics.economics...
And, of course, doesn't have any more to say than Y-generation "one
liners".
Me, again!
On Tue, 17 Nov 2009, Antonio Huerta wrote:
> On Nov 17, 4:51 pm, "Me, again!" <arthu...@mv.com> wrote:
>> ... causing people to sell dollars and
>> buy Euros (maybe Yen, too, and all through "free market" currency
>> exchange processes) because both Yen and Euros have been going up the last
>> year or so by 20-30% (good ROI, and its been a linear increase over that
>> period)
>
> I'd say it is bulshit. How can a currency go up 20% a year and make
> someone buying it rich ?
If you used USD back in about January of this year to buy Euros that same
day, then, today, those Euros would buy 30% more USD than you used to buy
the Euros. All the rich guys, hedge funds, anyone else doing this is
getting rich.
When you come to spend those Euros which
> increased in value, and want to buy the goods, you will see that their
> prices increased by the same 20%. No win.
Nah, you keep that stuff in the bank. Then when it looks like Euros are at
the peak, then you buy up all those cheap USD.
> But generally, I agree with the idea that the Chinese will lose when
> the US dollar collapses because the Chinese hold all of their income
> from selling the consumer goods to the US in the US currency paper.
For the time being, they would be wise to hold onto whatever they have (or
what's left of it). They've probably been quietly selling some back some 2
years ago when they actually announced they were going to diversify their
reserves.
> The dollar collapses, and the Chinese's wealth will collapse, too.
> From the other side, the US was recklessly printing dollars, and
> paying the prices to the Chinese which the Americans could not pay
> otherwise. If the Chinese could get something tangible out of their
> current holding of the US dollars, then the Chinese clearly benefited
> from the whole affair.
I'll bet some money that at some point not to far in the future that the
whole trend is going to reverse itself.
>
Me, again!
I've overheard teenie-boppers in stores talking to other teenie-boppers on
their ceil phones with unbelievably nonessential conversations.
Me, again!
On Tue, 17 Nov 2009, Old Pif wrote:
> On Nov 17, 1:51 am, "Me, again!" <arthu...@mv.com> wrote:
>>
>> What I have noticed in the last few days regarding the Obama to Asia trip
>> is that the WSJ said that Obama was saying Asian dependence on the US for
>> export-driven economic growth was not sustainable (implying something like
>> that debt-based consumption of Asian exports can't continue).
>>
>
> Good. He obviously get it from src. We have been talking about that
> for years.
Gee, I wish it were true. But, funny thing, for all we talk about...I
never read about it in Wash Post, or NYT.
>> At the same time
>> the Financial Times (out of London) was saying that the Asians were basically
>> saying that Obama should continue to proclaim and support "free trade"
>> (meaning that they really like making money off the US and to hell with
>> our trade deficite).
>>
>
> That is fantastic. WallMart is not going out of business anytime soon.
Nah, all that bricka-brack that you pay $14.95 for at Walmart, they pay
the Chinese about 43 cents for, and next year they are going to get them
down to 39 cents because Walmart is going to stimulate OUR economy, and
THEREFORE, China's economy by LOWERING the WM price here some more, thus
stimulating broke US people to spend more of the less money they have.
Logic, eh? (just what alexy loves).
>>
>> Now, today, the WSJ was saying that China gave Obama
>> the blowtorch in the ear that they are mad specifically at us for letting
>> the USD drop and that our deficit spending is to blame because big asset
>> bubbles are forming (and all our fault).
>>
>
> That is also very good if he listen. Trips to Europe become terribly
> expensive.
And, trips to the USA very cheap, so Europeans come over and buy up lotsa
our cheap stuff, thus stimulating OUR economy.
> All good news. Thanks.
Thanks for saying thanks. The other guys were asleep at the switch.
BMJ
They converse?
>
>
>
Me, again!
Yes, just like birds (tweets, twitters), dogs (bark), cats (meow).
Me, again!
On Tue, 17 Nov 2009, morris croy wrote:
> Of course. They're known as designated drivers.
In my neighborhood, alcohol-related car accidents haven't gone down much.
> This is especially the case in jurisdictions where it is a felony
> offense to be driving drunk or under the influence.
Yeah, we got that problem here, too. Doesn't change much.
Me, again!
On Tue, 17 Nov 2009, morris croy wrote:
> I have an easy solution that doesn't require all that much work. I
> just assume that 99% of everything I see and hear, is an outright lie
> of some sort.
>
I'm interested in the other one per cent. And, so far, I'm relatively
confident in identifying that 99% which is low value hot air.
BMJ
<snip>
>>>>> This newsgroup isn't much different in tone than the sort of
>>>>> conversations that a bartender has with drunk (or even sober)
>>>>> customers at a local bar or pub.
>>>>
>>>> I've guzzled beer in some dives where the conversations in this
>>>> newsgroup would be a considerable improvement over the chatter of
>>>> the remaining clientele.
>>>>
>>>
>>> I've overheard teenie-boppers in stores talking to other
>>> teenie-boppers on their ceil phones with unbelievably nonessential
>>> conversations.
>>
>> They converse?
>
> Yes, just like birds (tweets, twitters), dogs (bark), cats (meow).
>
When animals communicate, they usually have a purpose, such as alerting the
flock or herd to food or danger. As for the teenie-boppers, I'm not so sure.
BMJ
> On Nov 18, 9:34 am, BMJ <owlstretchingt...@yahoo.com> wrote:
>> When animals communicate, they usually have a purpose, such as alerting the
>> flock or herd to food or danger. As for the teenie-boppers, I'm not so sure.
>
When I was teaching, I rode the bus to and from work. One of the stops was
at one of the bigger high schools in town and it didn't take long for the
bus to fill up with the kiddies. You can imagine what sort of jabbering
the other passengers were bombarded with.