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Politics : Dutch Central Bank Sale Announcement Imminent? -- Ignore unavailable to you. Want to Upgrade?

To: sea_urchin who wrote (19549)	11/8/2003 4:43:31 PM
From: sea_urchin	Respond to of 81164

Part 2........................ > I still think the US dollar will fall because of all the liquidity. Methinks you have been listening too much to the gold-bug messiahs. If the USD falls the game is over. They have to keep it up in order to sell the debt. They have to create the illusion that the USD is "valuable". The Chinese must work for nothing and produce, the American people must be in debt and crying for jobs, the importer must become wealthy and the banks must be laughing. > Deflation of manufactured goods, inflation of just about everything else. Good deal for America. Let them sell us goods, we will print dollars for exchange. You've said it. So why do you argue against yourself?! > They apparently have a penchant for paper with dead US Presidents printed on it. Kind of like what happened when the white man first started trading with the Indians in North America. They traded beads for fur pelts. Good deal/bad deal. Indirectly, yes. The Chinese/Japanese banks use the US Treasuries as assets to enable them to create more debt in their own countries and so reflate their economies. I'm sure you know that banks can create at least ten times as much debt as the assets which they have "under their control". If the Indians don't get the beads they can't marry the squaw. Thus the beads are more valuable to them than the pelts. In fact, everyone is happy except the missionary who is complaining that that kind of trading was not mentioned in the Scriptures and the environmentalist who says that if the Indians keep on making fires they will cause global warming. > I hate to think what a real slow down in Asia would do to the USA. They won't have the dollars to prop up Uncle Sam. That's what the end-of-the-world messiahs, "equilibrium" economists and currency traders want and, indeed, are doing their best to bring about. But, clearly, in terms of the realpolitik of the "new" economy, the US is no longer confined to its boundaries on the map but extends all around the world. What Messiahs & Co fail to accept, or even apparently recognize, is that the economy of the US in now inexorably linked to those of Japan and China and wherever else. And, implicit in this linkage is the realization that the US can never repay its debt and likewise the creditors can never get their money back. The goldbug scenario that, because the US cannot repay its debt its economy is therefore in crisis, is patently wrong.