Actually the US is not giving technology away, not even if people pay for it. This is part of the political tension. Anytime you talk with China about the trade imbalance, they will tell you that the way to resolve it is to let them buy the tech they want and that will remove the trade deficit.
The problem is that we spend more than we are making. It is as simple as that. If we were not importing from China tomorrow, you would not see factories popping out all over USA the next day or year or even 5 years since. Instead you'd see us importing from Korea, India, Brazil, Mexico, etc.
Proper currency markets in the rest of the world mean that nobody can rack up the kind of irresponsible fiscal policy that we have. But because the US is the only country in the world whose debt is denominated in its own currency, we simply barrow more and more and print out worthless paper when the going gets tough.
In a not too distant past we managed to soften the blow of this reckless behavior by forcing Arabs to sell oil in dollar and by scaring the world from Soviet Union and getting them to buy over priced fire crackers from us.
That gravy run has come to an end. The Soviet Union is no more. The Russians sell enough oil and gas to have a serious impact on the world markets. And Euro is an alternative the greenback as a reserve currency. To make matters worse, our bankers in Beijing have been slowly dumping our paper in Africa. They are careful about it so as not to cause panic, but their footprints is clear for those who can read the writings on the wall.
Over all, the way to go is to invest in BRIC country baskets, natural resources (esp. oil), multinational corporations who make most of their money outside of the US, and the very leading technology companies. Stay away like plague from anything that is primarily US based: SM Consumer cyclicals, builders and real estate companies, service companies, and whatever that is mainly USD denominated.
ST |
