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Politics : Politics for Pros- moderated -- Ignore unavailable to you. Want to Upgrade?

To: carranza2 who wrote (764629)	7/3/2022 9:31:33 AM
From: skinowski	1 Recommendation Recommended By pak73 Respond to of 793927

>>>> The Euro is doomed. There is money to be made in that space.<< LOL! A few month ago I posted here an arguably semi-funny joke that perhaps the entire affair of getting Russia to fight was a long term operation to create a setup for Soros to short the Euro :) Well thought through article. Nice. Very nice explanation of the relative importance of different sectors making up the GDP. Speaking of the service sector, it’s vital, of course - but much of it adds up to “you scratch my back, and I’ll scratch yours”. In other words, parts of it aren’t all that vital, or even not vital at all. They survive off the wealth of the land. Nail polishing comes to mind. Imo, it is obvious that sanctions work both ways. Hate to pick on one of my very favorite presidents, but when Trump issued an order to stop sales of computer chips to China - including anything that was manufactured in other countries using American intellectual property - or American machinery - Goldman/Spengler argued that this is guaranteed to cause trouble. China has their own chip industry - but they never bothered developing the most sophisticated chips, the most modern - preferring to buy them from the US. Spengler argued that this will force them to develop their own high level chip manufacturing industry - and compete with the U.S. That’s exactly what happened - they hired tens of thousands high tech engineers - about 50K from Taiwan alone - and they’re about ready to compete with us. Our record of competing with Chinese manufacturers, up to now, hasn’t been stellar. Sanctions and asset seizures, when used too readily - are guaranteed to shoot one in the foot. People talk about the USD being the world’s reserve currency. And it is. But it’s important to remember that there is an entire basket of reserve currencies. The USD is the most widely used among them - but foreigners are free to chose how much they want to allocate to each of the components. They make their decisions based on many factors, some of them obvious (the issuer nation's stability, for example) - and some are not. If the USD will suffer loss of demand, it will not happen overnight - it will happen gradually, based on decisions made by individual nations and banks. Asset seizures will go a long way in causing this decline in the global demand for the USD.