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Politics : Welcome to Slider's Dugout -- Ignore unavailable to you. Want to Upgrade?

To: patron_anejo_por_favor who wrote (211)	7/20/2005 5:23:55 PM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 50669

Hi patron, in my opinion; China's Forex Reserves are not viewed within the proper context. Everyone looks to China's Forex Reserves....but, what good is $711 Billion in Forex Reserves if you have over $800+ Billion in non-performing loans that will never perform, or be repaid - which now represents nearly HALF of China's $1,600 Billion GDP ? China's Banking System is already Bankrupt and look at China's Stock Market as well. China via the inherent Economic inefficiencies within the Communist System (see their 6-7 x multiple cost of utilizing Natural Resources below) is already on the road to inevitable Economic Collapse. Economically, Communism does not work - regardless of the hybridization. If it did... Cuba by now, would have a dynamic and thriving Economy, the former Soviet Union with thier incredible abundance of Natural Resources would not have collapsed and would be grabbing the headlines today instead of China and North Korea would not need to depend on the rest of the World to feed it's people. China has added massive over-capacity that upon the coming forced Currency Re-Peg, will see a massive exodus of Hot Money and a large portion of their export business lost to emerging Thailand, Vietnam etc. China is also negatively leveraged to rising US Interest Rates. China faces a Japan-Style Deflationary Collapse that will be worse than Japan's because of 2 Major Differences. 1. The inefficiencies inherent in the Communist Economic System. 2. Economic collapse being exacerbated by a collapse of the Communist Government and the resulting Social & Political upheaval that will result, that did not occur within Japan. ...but, oh won't it present one helluva historic investment opportunity post-collapse. Anytime an Oil Permabull talks about China and $120+ Oil...link them to the article below - as each $1 rise in the price of Oil has an exponential negative impact upon China's Economy and GDP Growth than it does the USA's. $120 Oil will collapse China's Economy into the abyss of Deflation and will probably start a Global Conflict. China's Economic & Political Collapse has already been orchestrated...it is inevitable. The Western International Bankers & The New World Order Idealogue's want in, want in cheap and want control of the inevitable rebirth of what then will become the Worlds most lucrative Economy. China needs to create an internal demand driven Economy....instituting a Minimum Wage - which will not happen under the Communists. **************************************************************************** re: China's Economic Inefficiencies in ultizing Oil and other Natural Resources: service.spiegel.de [" SPIEGEL: China is dazzling the world with its booming economy, which grew by 9.5 percent. Aren't you pleased with this speed of growth?" [Minister Pan: Of course I am pleased with the success of China's economy. But at the same time I am worried. We are using too many raw materials to sustain this growth. To produce goods worth $10,000, for example, we need seven times more resources than Japan, nearly six times more than the United States and, perhaps most embarrassing, nearly three times more than India. Things can't, nor should they be allowed to go on like that."] ....7 x more resources than Japan, 6 x that of the USA and 3 x that of India to produce the same $ of GDP. THAT my friends, is a recepie for either War, or Economic and Political Collapse... no other possible result. **************************************************************************** One other thing concerning these calls for $105 Oil and all of this speculation of - to what level Oil can rise to before it significantly impacts the US Economy. Once again, I think people are missing the point. It's not a Mathematical and Economic Equation. It's a Sentiment oriented - emotional equation. The death of 3,000 people in New York and the destruction of the World Trade Center - mathematically & economically, on paper could not have had the impact on the US Economy that it did. That is because the US Consumers reaction to September 11th was not a logical, or mathematical one.... it was an emotional tipping point that collapsed sentiment exponential to what the mathematical & economic loss would have otherwise indicated. $100+ Oil will have the same effect. If will create a psychological & emotional over-reaction in Consumer Sentiment & Spending - that is mathematically exponential to the dollar for dollar rise in Oil Prices that Economic, or mathematical exercises postulate. Oil may spike to those levels on an extreme event driven crisis such as a Nuclear attack on Iran from Israel, or the US and the closing of the shipping lanes in the Straits of Hormuz etc - but, it can not be sustained without causing what will be reminiscent of the Depression Era of the 1930's. As far as the Oil:Gold historic ratio, presently it clearly favors Gold. However, one commodity is presently being manipulated upward, while the other is being manipulated downward...but, sooner, or later - we know what happens to manipulations and when historic market divergences ultimately converge. My message to the Matt Simmonsite Peak-Oil Mythology Permabulls remains the same: - be carefull what you wish for. - Pigs get Fat, but Hogs get slaughtered and at the end of every Oil Cycle - there is one helluva Hog Roast. Slider`