Fears of dollar collapse as Saudis take fright

Ok hot shot, lets have at it.

Fact-USA is about 24% of the ENTIRE worlds GDP

Fact-USA is the worlds largest consumer of goods and services BY FAR.

Fact-The majority of the worlds trade is pegged to the dollar and the majority of the worlds cash reserves are held in dollars.

Fact-If the dollar collapses then the cost to Americans for the rest of the worlds output of goods and services becomes out of reach and we stop buying. Once the consumer stops buying the US economy tanks since the consumer is fully 2/3 of what makes it go. Once the economy tanks the countries producing what we were buying have no place to sell and either lower prices to dump their products or simply shut down. Either way they slide into recession or worse. This causes a domino effect and the entire world economy follows suit. It is not possible for ANY economy be it national or world wide to shrink 20+% and remain viable.

WE are the engine that pulls the economic train for this planet. Will that always be? I have no idea but it is the case at this time. Once the engine ceases to run the train stops. This is all simple economics, friend, and it is more then apparent you are clueless in this regard.

Whoa, easy on the rant bub. I’m impressed with your ability to regurgitate a few blurbs of trivia. What would really impress me is if you could construct a logical arguement with your trivia that proved your thesis. You know, something that showed cause/effect relationship. Give it a shot. Where your rant really falls apart logically is at your 4th alleged fact, because if the dollar declined significantly more than it has already, everything that we buy (e.g. oil)would become cheaper in all the other currencies making it possible for other consumers around the world to replace us.

How can you be so right on all the other FACTS about the economy, and then still spout the "we don't make anything in America anymore?" (#12)

FACT - US manufactures more per capita than any time in history, workers at highest efficiency ever....unemployment at all time low.

So if you wanna buy a sprinkler made-in-usa we should do what? Pull some design engineers out of silicon valley to build $3 sprinkler heads instead of designing $300 CPUs?

You guys shouldn’t get too carried away in economics arguments with the “If....then...and....then...” stuff.

In economics, you can stipulate first order effects, like increase price reduces demand.....that’s about it.

Only economists are dumb enough to then predict secondary and tertiary effects in global markets, which is as predictable as Texas weather during tornado season.

There is a cause effect to my arguments and there was no rant. You are unable to see it because your knowledge in the economic realm is insufficient.

Your claim that if the dollar collapses all the worlds goods and services would become cheaper to other world wide consumers is about the dumbest thing I've ever heard. The fact is we ARE 24% of the entire world economy and if you seriously believe that can be replaced without severe longtime pain then we have nothing more to discuss. Let’s just agree to disagree.

Rather then argue with you and cite the “figures lie and liars figure”quote, just do this. Google shrinking American manufacturing base.

Then come back to argue.

BTW, what exactly do we manufacture here in America?
TV’s, Appliances, telephones, clothing, automobiles (maybe some), pet food, fertilizer, what? For sure # of those EMPLOYED in the mfg end of things has gone straight down the tubes.

For sure # of those EMPLOYED in the mfg end of things has gone straight down the tubes.

So you're saying I should 'google' the same blogoshpheric hype that you've read as gleaned as accurate by the google web crawlers, and then as soon as I get on the same page as you, I can agree with you and be happy?

I work in the electronics manufacturing world. If you're interested, I can tell you how I went from a perspective in 2005 that is probably very similar to yours now, to a different opinion today after living in Asia for a few months, and working with engineers there, here and in Europe...

I don't doubt that a lot of sprinkler heads are manufactured in China now. But what I've learned is companies like Applied Materials building multi-million dollar capital equipment at 50% gross margins that is purchased in China to make semiconductors cheap enough to keep their 5% PC systems manufacturing lines afloat. Like the avionics industry, China simply does not have sufficient high-wage capability to manufacture this leading-edge capital equipment like the Americans and Germans can. It's not a matter of throwing more slaves at it.

So while the Chinese pay huge margins to support design and manufacturing jobs in Austin, TX at Applied, and the capital equipment is set up to depreciate immediately in Shanghai fabs, you can rightly say that America has "lost semiconductor jobs."

But I'd also be right to say that America (And Tokyo Electron) own the semiconductor capital equipment manufacturing jobs in high-wage Tokyo and California and Texas.

What I cannot get enyone to explain to me, and I hope you will, is if US unemployment is at an all-time low, then how are you going to get workers to manufacture sprinkler heads in America? Pull them off the semiconductor capital equipment assembly lines and train them to make garden hoses?

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