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

To: sea_urchin who wrote (22981)	4/17/2005 7:42:58 PM
From: The Wharf	Read Replies (1) \| Respond to of 81396

I tend to think growth stimulation would be minimal and product price inflation could be the major result for the US. Reason Our real-estate costs are high so one reduces space when one outsources. To rebuild is too costly so the increase of costs will just be transferred to the consumer unless the cost of production in China goes up which I do not think will happen as labor is their cost savior. Every country that does business in China will find an increase in cost when the peg is removed. That is also an increase in payments of loans that are used for development in China. For China there will be no impact as that is internal. Labor rate remains the same cost is the same no inflation actually reduction of unwarranted enthusiasm. As I am nattering I wonder if this all means that China Stocks are the best place to be? If we have to raise rates to curb inflation which we can't curb we also have the problem of today's more risky financing in real estate. Assuming that the average earners income goes up about 4% per year real-estate should of topped by now as entry level is way too high. It has not yet topped because interest rates have helped hold this market. Here in this area property continues to rise. As long as it continues to rise here and NY it seems that other areas of the nation will continue to increase because of area growth and the over flow from the high costs areas. The real estate bubble could theoretically continue until China drops the peg. AG has been very vocal about his concern of Freddy and Fannie. In the meantime we have all these dollars floating back here that should be doing something to create value. I have given my self a headache as it seems possible that the bond market could crash the stock market dive and interest rates rise? China has decreased the value of her US dollars holdings when she revalues she has less foreign investment on her books. That is beneficial for China investment as she can invest here on a higher Yuan base. Plus again for China stock market use those dollars up. I think before Snow with or without the help of the IMF whose largest voter is the US/ To me Snow had better sit down and draft up some very careful plans as to how to avoid one huge banking mess. Heavens is the Yuan was valued on a big Mac we would be in one large mess as the the US lost 3/4 of its value in one bite.