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To: Ilaine who wrote (7380)	8/18/2001 1:58:46 PM
From: Don Lloyd	Respond to of 74559

CB - ...If the countries that export to the US don't import from the US how long can that go on? ... It should make little difference whether a country imports directly from the US, or indirectly through a third country. When a citizen or company in a foreign country sells (exports) something to the US for dollars, what are the possible alternatives, and their effects? 1. Dollars are hoarded. This represents an incremental increase in the purchasing power of the dollar as it incrementally sops up money supply in the US. 2. Dollars are circulated in the foreign country in parallel with the local currency. [unsupported opinion follows] As the quantity of locally available dollars increases from zero, the exchange rate of the dollar in a local (not euro or yen) currency initially increases as the local currency is preferentially spent when a choice is possible. Later, when enough dollars exist to serve routinely as a local medium of exchange, more dollars merely serve to increase the local dollar money supply and reduce its local purchasing power, and its exchange rate. 3. Dollars are spent to buy US or third country products or assets. [no special insight to follow] Whenever a dollar is spent it represents a decision that the dollar is worth less than whatever is acquired, from the point of reference of the spender. This would normally seem to imply a reduction in the purchasing power of the dollar, compared to not spending the dollars. However, the opposite is true from the viewpoint of the seller who prefers dollars to not selling his product. 4. As undeveloped countries advance, they represent an unfilled potential demand for dollars (or euros) for both circulation and the storage of value. The filling of this demand has a positive impact on the purchasing power of the dollar as, once again, dollar money supply is incrementally sopped up in the rest of the world. In actuality,of course, the effect is usually far overshadowed in size by money supply increases by the central bank. Regards, Don

To: Ilaine who wrote (7380)	8/18/2001 5:51:15 PM
From: Maurice Winn	Read Replies (7) \| Respond to of 74559

<If the countries that export to the US don't import from the US how long can that go on? > CB, twenty years. The USA is creating a Greater Co-Prosperity Sphere. The USA is Colinizing the world with a Condominium [lead by Colin Powell and Condoleezza Rice - GeorgeW just collects the salary, they run the show]. It works like this. I swap my hard-earned Kiwi dollars [which were actually earned in Canada and Europe but let's not confuse the picture] for US$ [selling them to some Americans who have come to Kiwiland to try to win the America's Cup]. I want US$ because Aircraft Carrier USS Enterprise has the smartest people wanting to invent great things which the whole world wants to buy [though they don't have the money yet, being poor Chinese and Indians]. USS Enterprise has the smartest people because they have been hiring them from around the world for decades. They also have other stuff, such as a capital base of highways, hospitals, blah blah blah, cruise missiles and a solid legal and political system. I hire those smart people to invent really good things and sell them around the world. Which they do. Alan Green$pan prints a whole lot of money and spends it or lends it. The USS Enterprise uses that newly-printed money to hire Chinese to build factories and do CDMA design. The Chinese figure that is a lot better than working for Mao for half the rice they grow, so jump at the offer. They get dollars which they use to hire servants and a rice harvesting machine so they don't have to cook, clean or paddle in the paddy field. Thailand is grateful to have sold another rice machine and with those dollars, buys a whole lot of CDMA phones from China. International Harvester, which gets a royalty on the rice machines and owns a share in the company in Thailand, builds another factory in Indonesia [where people will work for even less money than Thailand due to population growth]. Pretty soon, you have rice machines all over Asia. The locals figure it's a good company, so buy shares in it or give their US$ in a share issue to expand production. You also get a lot of CDMA. People like to do these transactions in USS Enterprise currency [Jay has explained why and I agree with him]. Contrary to what Jay says, the Japanese do know how to have fun. My son is taking them snowboarding - there are a dozen of them here [at Mount Ruapehu] right now [if you have a Japanese-enabled brower, click here: snowadventures.co.nz ]. He is also teaching them English here: eigokyoshitsu.com There is also a 16 year old Japanese girl in our house right now who is here for a few weeks to learn Engrish [my wife likes to do stuff like that]. They all have a LOT of fun. They also [generally] have a lot of money, contrary to the idea that Japan is economically bankrupt. QUALCOMM ships a lot of the dollars home as profits, pays taxes to USS Enterprise to maintain the system and pays the shareholders the rest [or reinvests in more expansion]. The shareholders are me, out here in Kiwiland. So I buy rice equipment and CDMA phones and play golf, enjoy family life and figure out the next great thing to do [to invest in or invent]. I ship more money to QUALCOMM, who ships it to India to hire a swarm of Indian software, ASIC and other technological experts [perhaps including an educational facility since the Indians have mostly been planting rice, instead of learning stuff, due to the exigencies of hunger]. Meanwhile Uncle Green$pan keeps printing more and more because demand out in the bush keeps increasing as CDMA, rice machines and demand for Boeings, DNA engineering and cyberspace keeps increasing. The money just goes on flowing out of the USA. He prints and prints and inflation doesn't happen because demand for dollars is huge and growing as 6 billion people need to finance [using a safe currency] their development. It can go on for decades at the current rate. Provided J6P doesn't vote to fire Uncle Alan and GeorgeW stays on holiday and the senile senators are kept in women and wine, the whole show can keep on going. A Pax Americana run by Colinisation Powell and Condominium Rice is not all bad. Send more US$!!! We'll send profits back to USS Enterprise. We'll sell you the stuff we produce, or make your bed, grow and cook your food and build your hotel if you go on holiday to our lovely Eastern and Polynesian countries. We'll attend to your every need. We'll ship our sheep to your dinner table in Peoria and microbrewed Speights to your Made in Kiwiland refrigerator. You can wash your clothes and dishes cheaply and conveniently using the Fisher and Paykel SmartDrive washing machine and DishDrawer, two-draw [or single] dishwasher. usa.fisherpaykel.com There are 5 billion of us and we want a LOT of US$. A money system is as valid an export as a CDMA phone or a Ford car. It's the ultimate in software. Zero production cost [Uncle Alan can just write a cheque for $1 trillion and there it is!]. People can't clone it or illegally copy it [not much anyway]. Cruise missiles and gaols and jails await cloners and intellectual property thieves [execution in Saudi Arabia and China]. Interestingly, the US government is NOT worried about their own monopoly profit, the biggest one on the planet, which makes Microsoft's look like a puddle compared with the ocean of US$$. What hypocrites! The world is afloat on an ocean of US$. But it's not deep enough or extensive enough. More, more, more!!! That's what I think anyway. Now, I must go and enjoy wealth [or value, whichever people call it] and sunny Sunday. Mqurice