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Non-Tech : Kirk's Market Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (3107)	5/17/2015 10:34:08 AM
From: Kirk ©	1 Recommendation Recommended By Gottfried Respond to of 26631

I think eventually it matters to other countries because the parties eventually have to stop spending to repair their balance sheets. I posted the China story because it points out a debt problem and I was hoping someone would agree it's entirely internal to China. It is not like Greece where OTHER countries provided the loans. Could this lending by Chinese banks to local governments that are not good credit risks have international implications? I think it might.0 Less spending means fewer sales by international companies that sell to China so it eventually may hurt everyone. Kirk, you're right - we should not compare our pension liabilities to China's internal borrowing for local infrastructure projects. Those are hard enough to understand by themselves. I wanted to make a point that our Fed QE that bought government bonds at very low rates was very similar. We as a nation prefer to borrow and spend it on military while China spends on infrastructure, but I believe they spend on military too. Also, our government told private banks to lend to those who could not afford to pay the loans back and even the GOP president Bush 2 seemed to delight that people were in houses that they couldn't afford with the crazy, no doc loans, etc... when the banks eventually failed, they were bailed out and the punishment for the bankers was... "bailiff, whack his pee-pee" cheechandchongfans.com The whole thing reeks of something you would expect from a corrupt, communist government not a free society with rules of law. I spoke to bankers before the collapse and the fear of Jessie Jackson starting a protest in their lobbies was very real... so they were aware of the problems. Some blame the banks for trying to profit in this mess by selling the loans, CMOs, etc. to others, but few want to blame the others for being greedy, especially when many of the "others" were pension funds, etc. who should have known better, but for political expediency, blamed the banks for taking advantage of their greed and stupidity. China seems to be eating their seed corn now for similar reasons... make the present look good and let someone else clean up the mess.