Posted on 08/07/2007 10:52:02 AM PDT by blam
Where do you get that crazy idea? The US dollar is at historic lows, and yet GDP growth is still hummin’ right along.
There’s no correlation between Chinese GDP and the value of the yuan.
I hope they do. We need to rid ourselves of their threats now. We should never have given the MFN status and dropped our tariffs in the first place. What ever disruption in our economy they cause will force a correction that should happen anyway. Better now than later.
If this ... "The trick is that the exchange rate of the dollar against other currencies with which we will have to deal depends on the strength of these certificates."
.. is a valid statement ... that would mean (as I understand) ..
(Very simplistic) ... 20 years ago, they bought $100 of certificates at, say $75 ('cause we needed/wanted the money) ... and we promised to buy 'em back for $125.
If I'm still thinking correctly ... those numbers were based on an even exchange ... say 1000 yen = $100.
Now, our $100 of 20 years ago is worth only $75 ... and if the yen is now 750/$100 ... if they want to redeem .. we win ... if the yen is say, 2000/$100 we lose.
I can't stay here longer to reply, I drive truck and go out at 3AM ... need to sleep ... but I'd be curious to know if I'm following that.
And of course, if you ARE full of crap ... it's nice to know I have company.
The short version goes something like...”I owe you a hundred dollars - I have a problem. I owe you 1.3 trillion dollars - YOU have a problem.”
Wrong. Their currency is pegged to the u.s. dollar at a rate determined by them. A falling u.s. dollar means a falling yuan, making them more competitive to the rest of the world. Meanwhile, selling our bonds they hold sends interest rates up because rates rise when bonds fall. Net, net, it hurts us and them.
Dumb knee jerk reaction on China’s part. We will take our time... close opportunities here... a little there.... slowly we’ll block China from all sorts of economic gains... before long they’ll be on the outside looking in.
I already said that it hurts us *and* them. But the point made in this article is that China is threatening to dump US treasuries because the US is considering taking actions that would force China to float the yuan.
There are things that the US can do via the WTO (with support from Japan and the EU) to force the Chinese to float the yuan...and they know it. That’s why they’re rattling their saber on this issue.
[the Johnsons load their guns and point them at Bart. Bart then points his own pistol at his head]
Bart: Hold it! Next man makes a move, the nigger gets it!
Olson Johnson: Hold it, men. He's not bluffing.
Dr. Sam Johnson: Listen to him, men, he's just crazy enough to do it!
Bart: [lower register]
Drop it! Or I swear I'll blow this nigger's head all over this town!
[higher register]
Bart: Oh, lo'dy, lo'd, he's despit! Do what he sayyyy, do what he sayyyy...
[the Johnsons drop their guns. Bart jams the gun into his neck and drags himself through the crowd and towards the station]
Harriett Van Johnson: Isn't anybody going to help that poor man?
Dr. Sam Johnson: Hush, Harriet, that's a sure way to get him killed!
Bart: [higher register]
Oooh! He'p me, he'p me! Somebody he'p me! He'p me! He'p me! He'p me!
[lower register]
Bart: Shut up!
[Bart places his hand over his own mouth, drags himself through the door into his office]
Bart: Ooh, baby, you are so talented! And they are so DUMB!
They'll sell to each other - lots of Chinese.
With what money? Counterfeited North Korean hundred dollar bills? They don’t sell to us and the Chinese Communist Party will join Nicolai Ceaucescu within five years.
So let’s declare all Chinese imports banned.
This p*ssing match is going to happen at some point.
Let’s get to it. Right now.
When the notes come due....
I knew you were involved!
"Greed is good." -- Gordon Gecko.
Ford figured it out when he paid his assembly line workers enough money to buy a Model T. That the Chinese have not “gotten it” for this long is a function of their weird left-over communist ideas...
Well don’t blab it all over everywhere...
:)
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