hello hawk, a few items for consideration
(a) we are no longer in a zero sum game, because we are now clearly in a negative sum game, at the rate of several trillion per month, heading to zero very fast. the first one to get to zero does not lose in this last man standing game. the one losing the most loses.
in this game, the one with the mostest will lose the most, for that is the nature of the game.
given that the game naturally involves us$, then the game certainly engages with china, and so the pondering must take account of what the large combatants did, are doing, and might do.
between usa and russia a different dynamic exists, and so we do not need to take that pair nearly as diligently.
(b) on china's announcement, i think china merely announced a plan made long long time ago, one that had been held back from implementation due to lack of political capital
now that an obvious crisis is upon all, capital call
it is not as if china did not figure on having to develop the rural hinterland or accelerate the satisfaction of 600 years of pent-up demand for yet another piece of infrastructure
on per capita basis, china lags mexico in very many items made of cement, steel, copper, glass, etc
crisis are god-sent, but to take advantage of it takes deliberate men who thought ahead
folks were always complaining that china is not reving up its domestic demand, and so must have no use for savings that become excess
well, time will tell, but change is maybe
(c) china panic responsed, possibly, but the response is with a plan made long ago, the outcome may be different when one spends excess savings on stuff one needs, had to do, sooner or later, as opposed to spending money one does not have on things one cannot possibly need, by accelerating borrowing and stuff same down the black holes that be aig and gm and ...
time will tell, certainly educational
recommendation: buystillmoregold
(d) on gold benchmarking, i recommend acting-man.com as a good read
give me your e-mail and i will send you a definitive study of gold during periods of inflation and deflation since ancient times.
my doubt is regarding whether we are actually in 'deflation', or 'forced sale'. small diffrenece, but ultimately may prove to be important detail.
cheers, tj |
