Mr Vet > how can "other nations are enriching themselves" possibly happen while they are getting paper promises and the US is getting actual goods and services with real value
Possibly in the first instance, but just a glance will tell one that the nations of Asia are developing like crazy. China of today is not China of twenty years ago. Secondly, although US debt is theoretically no more than a "paper promise", it still has value in our world of paper assets. US debt is bought by the Asian CBs and, in their hands, constitutes an asset on which they can make loans to others. Thirdly, the goods which the US buys are not necessarily assets of substance. I imagine they are largely consumer-type, throw-aways with a high rate of depreciation or obsolescence. So the US consumer has to keep buying. Fourthly, while the US buys Asian goods, and at a very cheap price, its own industries disappear. Eventually it will be totally dependent on foreign production like an addict is to drugs. Increasingly, the US worker is being robbed and impoverished. If he wasn't so hooked into religion and the terrorist crap, there would have been a Marxist revolution already.
> The game goes on for as long as the "other nations" finally figure out that a vault full of US denominated debt printed up without limit doesn't actually "enrich" anybody except the country that managed to trick them to exchange it for real wealth.
I'm sure they know that already. That's why every so often they give Uncle Sam a little nudge to tell him they could be selling his Treasuries or buying Euros etc. And that sends the financial markets into jitters. The US may have its teeth into Iraq and its claws into Iran but its balls are firmly between the teeth of China, Japan, S. Korea etc.
> So much for the holders of the "old dollars".....
No doubt about that. Just like Argentina. But that's the game -- and it's the only game in town. One might even call it a merry-go-round. You win some, you lose some. But the US thought it was going to be the winner -- forever. And I imagine many Americans still do. |
