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When you get to the bottom of this, it is all really about U.S. and China. U.S. is urging China to appreciate yuan and develop domestic economy. However, rising yuan would greatly hurt export prospect for China. Developing sustainable domestic economy, not stimulus spending binge, will take long time and noticeably slow down growth rate. So China opts to return to the status quo, except dumping stimulus money to offset the downturn.

So China would settle for continued huge trade surplus and amassing further dollar reserves. They find it safer than the alternative outsiders are urging.

Disengaging from Chimerica loop is too drastic for China, as it has been to U.S. As a result, both are sinking together. U.S. first, and China to follow soon.

In the mean time, Zero and Ben gets to have more spending money.

1 posted on 10/27/2009 1:28:52 AM PDT by TigerLikesRooster
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To: TigerLikesRooster; PAR35; AndyJackson; Thane_Banquo; nicksaunt; MadLibDisease; happygrl; ...

Ping!


2 posted on 10/27/2009 1:29:17 AM PDT by TigerLikesRooster (LUV DIC -- L,U,V-shaped recession, Depression, Inflation, Collapse)
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To: TigerLikesRooster

“Currency basket”, let’s see where have I heard that? O, now I remember OPEC, Russia etc want to price oil this way. On another note, isn’t nice how a communist country will let their own people suffer instead of prosper?


3 posted on 10/27/2009 1:38:49 AM PDT by momincombatboots (Tom Lyons: Son in Law, Husband Father 1988-2009 KIA 090809- Hero 2 me)
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To: TigerLikesRooster
Export-dependent Asian economies are suffering from a double problem.

Wasn't it GHWB who pushed Most Favored Nation status for China, in spite of their refusal to meet the Human Rights requirements for such status?

We opened up our consumer market to China, in spite of their near-slave-labor conditions, and in the process devastated our own manufacturing base, displaced millions of American workers. The vast majority of those American workers have never regained their previous level of income, and therefore are not consuming at their previous levels.

Had the Human Rights requirements for China remained intact, as a condition for access to American markets, China would have been required to provide a civilized level of compensation for its workers, and consequently would have developed their own sustainable economy.

Instead, a handful of Free Traitors got wealthy, America got an economic collapse, and China is still an export-dependent third-world cesspool.

4 posted on 10/27/2009 1:53:10 AM PDT by meadsjn
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