Hello Seeker,
With <<Here we are in 2008, and the US dollar is so holy that the same Communist government has accumulated the world's largest hoard of same. Why??? I, a simpleton, have not owned US assets since early 2003. What does Beijing know that I do not? Why didn't they get rid of their US dollars at the time of their receipt?>>
You asked an interesting question.
My answer would be that China took in the US$ and did not let it go immediately in exchange for anything else because:
- it was not the right time of history to do so
- one had to ride a wastrel donkey before one gets to try a horse
- there was much wealth to extract from the empire by way of revenue, turned into profit, transformed into savings, converted into credit, to keep the fascinating game going, earn some paltry and sacrificial interest, etc, so on an so forth, once again and twice more, ad infinitum, ad nauseam, and let’s keep playing
- until when it becomes opportune to do something that changes the nature of the game, give the counterparty a few months to adjust to the idea, and then, as creditors invariably can do at any time, call for a change of tunes
are we at the opportune moment yet? I do not know, because typically Chinese would study, discuss, plan, discuss some more, make a decision on what to do, and then wait, wait, and wait some more for the opportune moment; much like a hunter stalking a prey, and then, all of a sudden, bang, and the guessing stops.
It was like that in the lead-up to the Korean peninsula conflict, the Vietnam conflict, the RMB revaluation conflict, and now, the Dollar conflict.
So, given that we cannot know when, and are aware of how, we then must also match the Chinese in study, reflection, discussion, planning, allocation, and wait, wait, and wait some more.
As to <<P.S. I am not being sarcastic. I am busy with my own work which is science, not economics so there is no way that I would understand the value of the USD. But the keepers of
unimaginable fortunes should understand such things. You, Tobago Jack, have been talking about collapse since 2001, so doesn't that include the drastic devaluation of the USD? Unlike the case of Iran, the surplus in Beijing's hands is surely real>>
I first remind all that I have always stipulated that Message 18552276 (July 2003) “As I had mentioned long ago, the COLLAPSE is a PROCESS continuum, and not an EVENT singularity, as had been pre-viewed in Japan and spot-sighted in Argentina.”
… and so here we are, doing a global ZIRP, to avoid an Argentina outcome, even as that outcome is bang-on for sure to happen.
In the interim, between my 2001 collapse call and now, gold has do so very well, with the S&P 500 collapsing against gold by 75%.
Now?
Now the event singularity we have been preparing for, waiting on, and praying to prey on must be closer to the defining moment.
I do not expect cataclysmic collapse of the dollar against the rmb, euro, yen, aud, cad, the zimbabwe dollar (ok, I am exaggerating a bit).
I do expect all paper monies to devalue against the one money that rules over all monies, the true measure, the absolute benchmark, the eternal, beautiful, and for the scientist, the element with 79 electrons, the gold.
In any case, at the grassroots level, happenings are happening, with folks reaching out to lovely gold.
online.wsj.com
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Gold demand rises in Saudi Arabia |
