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To: Final Authority
can you cite a reference to back your claims?

Which one, the 5-to-1 trade ratio, China's net operating surplus against the world, or the cumulative $800 billion currency stash?

866 posted on 02/16/2006 8:54:02 AM PST by Paul Ross (Hitting bullets with bullets successfully for 35 years!)
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To: Paul Ross

You have answered but I think you may have mislabeled the links however. The $800 billion quoted, if you noticed, is in foreign currency reserves, not necessarily USD. Notwithstanding that, no nation or entity that has reserves of currency just hoards it under a mattress but rather it is invested in short term notes or money market funds and in the end the US Treasury borrows that to support our debt. It may have a large reserve of currency now but that is because they can not consume that which the reserves will buy without causing massive internal problems. As China's economy grows that currency reserves will be used to continue to buy more oil on the world market, buy ores, buy logs, and buy the technology they need to continue on the path to growth.

BTW, do you advocate for a protectionist trade policy with China? And, do you realize what would happen if nations did not have currency reserves to finance our national debt? And, if this is true, what would you advocate to redirect our trade and fiscal policies to wean us off of foreign investment and trade deficits?


953 posted on 02/16/2006 2:10:01 PM PST by Final Authority
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