thank you...
Posted on 10/17/2007 3:02:52 PM PDT by Navydog
Over the last 30 years, China’s economy has grown at an average annualized rate of nearly 10%. While this statistic alone is jaw-dropping, what is more impressive is the extent to which the nominally Communist country’s economy has become intertwined in the global economy. China now exerts enormous influence over the economies of virtually every country in the world, and a slight change in its domestic economic policy has the potential to send shockwaves rippling throughout the world. Nowhere is this more apparent-and frightening-then in China’s economic relationship with the United States, which is very much at the mercy of China when it comes to prices, wages, interest rates, most importantly, the value of the Dollar.
(Excerpt) Read more at currencytrading.net ...
No question the USA is at the tail end of the biggest credit binge in all history.
“How China Could Crash the US Dollar on a Whim”
Destroy their own economy on a whim??
You must think that they’re Democrats!
I have been hearing this for 30 years. As a percentage of GDP is that true?
There are people lined up in front of Walmart hq waiting for the Chinese to mess up. They carry contracts for factories in South Korea, Guatemala, Phillipines, Thailand.
They just sit there and wait, knowing that at some point a suit will poke his head out the door and tell them to come on in.
LOL! You're right. If they pulled out, interest rates would skyrocket, tanking our economy and taking the Chinese economy down with us.
They won't do it. China's leaders are completely amoral, cold-eyed realists, who always act in their own interests.
Who are the Chinese going to sell to? The Belgians?
Thailand?
thank you...
That will really help them when they go to cash in all those T-bills
This is never going to happen, if they did do this it would be considered an economic attack on the US and an immediate boycott of all Chinese products, would put 100 million Chinese out of work. They already face increasing competition from other low labor countries like India, that could take over all Chinese production in a flash. This would result in a permanent loss of market share that China would likely never recover.
These are the Commie Chinese, and they are dumb enough to do this.
Anyone familiar w ChiCom history knows that the Commies (esp Mao) were economic morons. Dount that the “Children of the Long March” have learned from this.
Instead of the weak Liberal-Globalist response from the White House towards Commie China, time to take action. Next time Commie China gets a case of the ass....close US ports to their goods for a few days. Watch the Chi Coms dump in their pants.
This is not to say this cannot happen. But if it does the deliberate act will exact a cost that the Chinese government will bear a substantial proportion of.
Further, and I hate to bring this up to people who think they know everything about FX, except for actual cash, that is to say, US Federal Reserve Notes, the Chinese do actually hold any US money. The trillion dollar foreign exchange reserve is held in electronic form in their accounts in US banks, in the computers of those banks. Of the agency instruments such as those from Treasury or GSEs, they are also held in electronic form.
Needless to say, if the Chinese started acting serious about destroying the dollar, but the Federal Reserve and the Treasury would invoke emergency authority to deter the actual selling of those assets.
Additionally, the Chinese have started a government fund directed at investing their horde in other instruments such as stocks on the open market. The instant the Chinese gave the appearance they were not a trustworthy counter-party, they would have difficulties, if not outright trading bans, in US markets, as well as the others.
I say this with the full understanding that the Chinese Communist government has presided over the deaths of tens of millions in both the revolution in which they seized power and the Cultural Revolution of 1966-69. Power is paramount, and as long as US Dollars brings more power to them on net balance, they will protect the value of their investment. Should it become worth a billion dollars to them to destroy the dollar (as well as the follow-on costs) they will not hesitate to do so.
Gee, all the American dollars they are holding would be worthless.Hey, they are not stupid er demorats.
I give China 1-2 more good years before their overheated bubble economy implodes and they go the way of the former Yugoslavia. The economic slowdown in the U.S. is going to affect the rest of the world, especially China & SE Asia, far than it affects the U.S. itself. Already base metal stocks are increasing around the world and the prices on hard commodities will soon decrease substantially.
US Dollar to Euro exchange
Would it take the Chinese down? Remember they have a dictatorial style leadership. If the Politburo decides it’s time, they can put their nation into a straight-jacket and survive while we would panic. Only martial law could put any semblance of order to the ruination we would face, and martial law in this country leads to anarchy.
Don’t be so glib in saying both would go down. That it's not in the realm of possibility. They can handle it better than we, because of the iron rule and strict discipline.
I see a large glow coming from the East. I wonder what it could be?
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