Posted on 11/27/2004 10:24:13 AM PST by soccer_linux_mozilla
The United States’ trade deficit is soaring and the once high-flying dollar has sunk to record lows against Europe’s common currency.
The dollar’s record low against the euro coincided with the government’s report that the United States was running a trade deficit through September at annual rate of 592 billion dollars. That compares with last year’s record 496 dollars billion. As a result, the country is having to borrow almost 600 billion dollars from overseas this year to pay for the imported cars, televisions and other items Americans are buying.
What is all this blather about "money"? It is PAPER, not Silver or Gold. I say print it as fast as possible and pay off the debts. Then let us go back to gold, which everyone will demand.
Well since I was alive in 1970 (in USMC) and remember those days very well and I am still alive today, I can tell you with assurance that our standard of living is no better today then in 1971. Technology has given us new fun things like PCs and DVDs, but instead of one worker supporting a home (dad) it now often takes two (mom & dad). At best a wash.
We're already on gold, insofar as you are once again (since Nixon signed his XO in 1971) legally allowed to own as much as you can afford.
Just don't try to use gold as money. That's an abuse of money. Money is used to facilitate trading, not storing wealth. Gold, on the other hand, is useful only for storing wealth (you don't buy watches or pay for dinner on the town with raw gold bullion, after all).
Do *not* hamper an economy by substituting a store of wealth for something that should merely facilitate trade. Gold and money are two different things, and should remain two different things forever.
Who's standard of living? Not American's.
"our problem is that the nation doesn't produce the wealth it once did. Free Traders have killed the money machine that the USA once was, sent it all over to China, India, Japan and Mexico. Less wealth, less wealth to go aound equals devalued currency."
Please note that the stock market stood at less than 100 in the 30's. It's now at 10,500. Why is that not creating wealth?
You're assuming that internationals don't have currency trading desks that are making a fortune on their dollar hedges at the moment.
Rubbish. You own more stock today than you did in 1970; everyone does save for a few economic embiciles.
...And homeownership rates for Blacks and Hispanics prove that Americans are *vastly* wealthier today than in 1970, when it was *rare* for Blacks and Hispanics to own their own homes.
In fact, in 1970 Alabama had the *only* urban neighborhood in America that had more Black homeonwers (Condi Rice's hometown) than White. Now that is common in urban environments everywhere.
There's more to America than just Whites, you know...
And stock ownership for Blacks today DWARFS that of 1970. Ditto for Whites and Hispanics and Asians in America, too.
So contrary to your ill-informed views, Americans are vastly more prosperous today than in 1970. Stocks and home ownership being the largest, most visible examples of that fact.
This does not sound like you. Are you being sarcastic? I believe I have seen you writing in support of the federal reserve before.
No, I'm presuming that anyone making "fortunes" on Dollar hedges are in the hedging business, not the outsourcing industry.
Wrong. All companies hedge their costs and revenues. They aren't in the "hedging business". A hedger by it's very nature is in another business.
Yes, but more people will have jobs, albeit, lesser paying jobs. Nonetheless...
BTW, you forgot to type "If". :-)
I noticed you ignored my observation that it now takes 2 workers to support a family instead of the 1 in the 60/70's. I guess if we put the kids in sweat shops you'd consider that a gain in living standard too.
Then you should never post to an article on currency declines, since "all companies" are clearly immune to such fluctuations due to their ever-present, brilliant currency hedging.
< /mocking >
To my point that our standard of living is up, it doesn't matter why...it just matters that home onwership is up, which even you don't disagree.
Unless you don't think that being a stay at home mom or dad is a real job, we've always had two workers in every nuclear family.
Notice though that our standard of living is up is not in question. You are merely debating *how* we raised said standard of living now.
The Republican Party cheerleaders are making a big mistake if they think they won an election because voters were voting for positive reasons. I am an evangelical who usually votes, but in the circles I travel many evangelicals have a routine and casual disdain for politicians of both parties. Most think voting is ineffective ever since they were blindsided by RoevWade. And they have do not have much faith in Republicans to nominate anti-abortion judges ever since the elder Bush put a ringer like Souter on the court. Many of the 4 million evangelicals came to the polls this year not to vote for Bush but to go on the record on Propositions concerning gay marriage. When they got to the polls, the only choice was to vote for Bush while they were there.
What the pollsters seem clueless about it the the wrong track-right track question, just as stupid as their exit polls were, is there interpretation of the results of this question. Traditional wisdom says that those who say that the country is on the wrong track will vote against the incumbent. For all the reasons I outlined earlier, there were a lot of people who voted for Bush who think the country is on the wrong track but did not want to vote for Kerry who might have derailed the country completely.
I am not sorry Bush won, because I understand what the alternative was. But that being said, I believe the country is on the wrong track and the Republican Party is lost and clueless. Arlen Specter should have gotten a public spanking and being taken out of consideration for any chairmanship. From time to time, I admit that I might put on a tinfoil hat, but I ain't drinking no Republican kool-aid offered by the gutless Republican leadership typified by Frist and Hastert.
Maybe, I am not convinced that manufacturing will return to the USA if labor here beomes as cheap as labor in China. I understand that is the theory, but I am not yet sold on that theory. Most nation have tariffs to protect thier industries. Traiffs can wipeout any cost advantage to manurfacuring in the USA and dumping to maintain market share can kill any home grown competition to importers.
I'd say the free traders have really screwed us good. Until the free traders are run out of Washington, we will continue to lose our wealth.
No. I'm beginning to realize that I shouldn't post to you.
If you're selling ten million dollars worth of wheat to Japan do you think some guy walks into your store plops down ten million and you give fifty boxcars worth of wheat? No. The wheat has to travel from Iowa to Houston to Japan and that takes time. Both the buyer and the seller are at risk for currency fluctuations so they hedge. Wouldn't you?
Your statement that outsourcing becomes unprofitable because of the dollar decline is wrong in many, many ways. This is just one of them.
That's not the theory. In a free market, manufacturing will return to the U.S. as the foreign exchange value of the Dollar multiplied by the Productivity of the average American worker equals the foreign exchange value of the Chinese Yuan multiplied by the average Productivity of Chinese workers.
If you leave out Productivity, then you've got garbage, not an economic theory.
The "backed" PAPER facilitated trade because there was a "store" of wealth, instead of a "story about paying someone some day". No country has ever paid back what it owed in the same value of the original debt. Indeed, pure PAPER has been tried in the past and usually collapsed after the people stopped accepting it.
E.g. one BBL of oil at $20 is = 1 Bbl of oil at $50. It is the $ that has been trashed, not the oil. The PAPER facilitates the trade as long as it moves rapidly or can be "invested in a store of value".
Certain supply demand aberrations have changed the $ side of the aforementioned equation. For example, no one stores and saves dollars, except possibly some people in illegal businesses with a vast supply of money continuously coming in; usually, people get rid of $, they call that investing. What is investing? Retaining the stored value with some aberrations for demand, supply, and time, e.g. houses. JMO
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