China's Economic Invasion: One Year Later

The Heritage Foundation ^ | 18. April 2006 | Tim Kane, Ph.D., Marc Miles, Ph.D., and Anthony Kim

[expat_panama]

...maybe you could do more to 'reduce the deficit' by putting your money into a U.S. concern...

Somebody please explain to Paul that when everyone (both Americans and the Chinese) puts their money in US concerns, that this is what makes the trade deficit bigger.  It's called the balance of payments.  The Chinese have been buying stocks of US concerns with money that they got by selling stuff like oil below cost.

Maybe I'm not explaining these technical terms clearly enough.   Is there anyone one else here that can tell Paul how the Capital and Current accounts operate?

[Paul Ross]

Based on the ticker, looks like your stock is taking a header...of course...maybe that's your opportunity. Get in while the market's low... :-)

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NYSE:SNP - China Petro & Chem Ads Quotes and Chart, 04/27/2006 16:20

Last	63 1/2	Bid	0 x 0
Change	-1 (-2.64%)	Ask	x 0
Open	63	Volume	399700
High	63	Div & Yield	0.49 (2.2%)
Low	62	P/E	11.2
Twelve Month High	71.96	Twelve Month Low	35.25
High Date	04/21/2006	Low Date	06/01/2005

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[Toddsterpatriot]

Your burden of proof. Show that it dollar for dollar is invested in "new businesses or expanding old businesses."

I see your reading skills are still weak. I said "If China holds $260 billion in US Treasury debt, that's $260 billion more that Americans have to invest in creating new businesses or expanding old businesses"

They could also spend it, put it in the bank or buy Paul a reading comprehension class.

It is going into good old fashioned GOVERNMENT SQUANDRY.

It the Chinese stopped buying treasuries either other buyers would come forward or the government would have to raise taxes. I prefer paying 5% to the holders of Treasuries because I can earn more than that on my investments. If you'd prefer to pay higher taxes, that's your problem. The best case would be if the government spent less, a lot less, but that won't happen if the Chinese stopped buying.

Even were that point granted...it is meaningless...bla bla

My mortgage is lower because the Chinese bought our debt. Why is that meaningless?

And we are having to increasingly bid against China as a competitor for our own resources. Energy is only one.

Our economy uses less oil every year per dollar of GDP. You remember our $13 trillion GDP?

It enables that increasing U.S. debt load that the Comptroller General is truly frightened of.

So if they stopped buying and Treasury rates rose to 7% would that cost the Feds more or less in interest payments?

The interest rate set on the T-Bills by the Feds is climbing steadily...likely at least 3 more increases planned...

The Fed doesn't set the rate on T-Bills. You really shouldn't comment on the financial markets. Your ignorance is so obvious, it's painful to watch.

Upshot: We're exchanging economic positions

Yeah, our probable 4%-5% GDP growth this quarter shows we are doomed.

[Paul Ross]

I like your article from Ream Heakal quite a lot. He explains that your position is theoretical. Not real. And look how he concludes his piece:

"Experience has proven, however, that without any controls a sudden reversal of capital flows can not only destroy an economy, but can also result in increased poverty for a nation."

[expat_panama]

...maybe that's your opportunity. Get in while the market's low... :-)

That's kind of what I was thinking, although it's usually wiser to wait until the the price stops falling.  Over the past 6 months the stock has increased by 50%, and the price has still not caught up with it's earnings.  It could double in price tomorrow and still not be valued as high as American stocks are.

Enough shop talk --back to patriotism.  Should I be the kind of traitor who increases the trade deficit by not investing, or the kind of traitor that lowers the trade deficit buy putting in an order for tomorrow's opening bell?

Decisions decisions ;-)

[expat_panama]

He explains that your position is theoretical. Not real....

Let me tell you what I call real.  Two weeks ago I bought 200 shares of a big oil company called Maverick Tube Corp. at $55.23.  Yesterday I sold it at $57.26 because of all the talk about how bad 'excess profits' were.    OK, I made $400 but I promise to donate it to a home for retired Defense Department employees.  I want the people a this home to enjoy all the benefits of a grateful nation, so I plan to invest it for them, but I want your advice about investing patriotically.  I swear I'm not making this up.

Do I invest the sales income plus cap gains into SNP and lower the trade deficit, or do we let the trade deficit get worse while we impose additional hardships on people who've already sacrificed enough for America?

I'm talking real money, real people, and real account balances here.  You tell me, which way do we go?

[LowCountryJoe]

I've tried...believe me I have tried. But, Paul insists on having things both ways and cannot come to grips that there are no free lunches.

[expat_panama]

Paul insists on having things both ways

My take is that Paul is not even able to insist on just one way.   We went around and around and neither Paul, nor any of the others for that matter, was ever capable of deciding what he wanted.  They seem to know a lot about what they don't want, but they never say what they want.

That must be why they always seem to get what they don't want.

[LowCountryJoe]

Check this exchange of views out.

It wasn't until after I reread Paul's reply to me (in his post #531 in the linked to thread) did I realize why he posted it in the first place. I had worded my post kind of awkwardly - certainly to the point that the Rhodes Scholar misunderstood what I was writing and felt that he needed to provide a definition of what the meaning of the word "bond" is. After the he replied I was scratching my head thinking, "Yeah, what's this got to do with the price of tea in China?" But, no matter. It allowed the perfect opportunity for one of us to, once again, take him over the knee and spank his little fanny over his terrible ignorance/stubbornness on economics.

[Paul Ross]

If you want "stone cold" profiteer advice, check out Jon Markham at Moneycentral where he explains precisely how China is Winning the Oil Race.

You have barely scratched the surface of traitorous ploys in your investing dreams. Markham opines:

For stone-cold U.S. investors, the obvious play here is to simply tag along by taking positions in foreign and domestic companies supplying the Chinese juggernaut, whether they are base metal producer Falconbridge (FAL, news, msgs) in Canada; a producer of Turkish energy like Toreador Resources (TRGL, news, msgs) of Texas; a producer of Venezuelan oil and gas like Harvest Natural Resources (HNR, news, msgs); or the two big Chinese energy companies CNOOC or China Petroleum & Chemical (SNP, news, msgs).

So you can be traitorous to your miserly heart's content. But you know how and from whom China is getting their oil...and what they are in fact enabling? They are aiding and abetting the Scum of the Earth. And there you'll be...aiding and abetting them all.

Meanwhile, the U.S. will just be plugging along making a 5% GDP growth. Apparently way too boring for you, an impatient type.

As Markham notes:

And our politicians are unlikely yet to ease up on rules preventing U.S. companies from participating in the sort of bribery and weapons brokerage that has become de riguer for doing business in the equatorial zone where most new energy sources are being discovered.

[Paul Ross]

HO! HO!! HO!!!!

Thanks for reposting one of my clear knock-outs of you all! You in particular Joe. Semper Fi.

You didn't have a leg to stand on after we were through with you. I know your little "bums" are still bleeding all over the place after the spanking we gave you and ToddAnti-Patriot...you probably still can't sit down.

But it looks like you have come back for more. My, you are bad boys, aren't you? Probably would have helped if any of you had actually had an REAL education... not what passes for it nowadays in Bsns School.

I assume you pine after being a Rhodes Scholar? In other words you want to be just another Typical leftist looney-tune. Dreaming of your World Government. And carrying around a sheepskin from Oxford?

Sad.

I just hope that this young Marine is not making a similar mistake as he goes to Oxford: Backstory: High school dropout to Rhodes scholar - mission possible

Maybe he won't get deluded like you were. But I would have to say since he is studying politics...there is grounds for concern.

[LowCountryJoe]

If you want "stone cold" profiteer advice, check out Jon Markham at Moneycentral where he explains precisely how China is Winning the Oil Race.

Should we get advice from him on whom to vote for in upcoming elections too?

Meanwhile, the U.S. will just be plugging along making a 5% GDP growth. Apparently way too boring for you, an impatient type.

Wishful thinking on the 5%...one could only imagine what you could possibly complain about in that instance but I'm sure you'd find something. For that matter, 5% is practically unobtainable with all the populist sentiment and economic stupidity that exists out there (and here). Protectionists would never stand for that kind of growth rate without finding some industry to regulate and protect.

[LowCountryJoe]

You in particular Joe. Semper Fi.

This is no knock against those that have not served but you, Paul, should be ashamed of yourself for being the poser that you are. I've watched you post things about equipment being fielded in the aerospace and defense industries and you seem pretty knowledgeable. But yet when I asked you if you've served - as I recall - you declined to answer. So, using a little intuition, I've come to the conclusion that you're either a defense department bureaucrat or some wannabe GI Joe who reads Soldier of Fortune magazines and fantasizes about being someone who doesn't have the stomach to do it for real. Which is it?

Semper Fidelis.

[Paul Ross]

You are the poser.

First, your libertarianism Leftyism is fundamentally incompatible with any kind of Duty, Honor or Loyalty. Did you your tongue burn with the Oathe?

You have been a consistent and utter phony. You are the Chinese mole infiltrators...the equivalent of General Giap...trying to sap American Resolve from within:

""We were not strong enough to drive out a half-million American troops, but that wasn't our aim. Our intention was to break the will of the American government to continue the war."

--North Vietnamese General Vo Nguyen Giap, in a 1990 interview with historian Stanley Karnow.

[LowCountryJoe]

Funny! I just reenlisted in March - after spending seven years of being out - and my tongue did not burn while taking The Oath.
A Leftist that embraces capitalism? That's not the libertarian party line. Try again, Paul. I will, however, wear the Paleo-liberal label proudly.
Just a reminder: your "answering direct questions" percentage is still declining, Betsy.

[Paul Ross]

A Leftist that embraces capitalism?

Oh yeah. Embraces it just like Globalists Thomas Friedman. Thomas PM Barnett. John F. Kerry. Barbara Boxer. Diane Feinstein. Bill Xlinton. And yeah. Hitlery too.

[Toddsterpatriot]

You didn't have a leg to stand on after we were through with you. I know your little "bums" are still bleeding all over the place after the spanking we gave you and ToddAnti-Patriot...you probably still can't sit down.

Why don't you tell us again how the Fed sets the interest rate on T-Bills? Clown.

[Paul Ross]

Why don't you tell us again how the Fed sets the interest rate on T-Bills? Clown.

Oh please. Your ignorance is just abysmal. Clown yourself.

[Toddsterpatriot]

You can't read a chart and now you claim that the Fed sets the interest rate on T-Bills. What orifice do you pull this stuff from?

[Paul Ross]

You can't read a chart and now you claim that the Fed sets the interest rate on T-Bills. What orifice do you pull this stuff from?

Your anus.