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View Full Version : China's Bucks vs American Bucks... And the Chickens Now Come Home to Roost!



ProjectPeter
Jan 18th 2011, 05:11 PM
http://politics.blogs.foxnews.com/2011/01/17/ahead-hu-visit-senators-push-china-trade-legislation

Funny... they kick and fuss right now about how China is hosing us now that they are out of power. Kick in the backside... we now have to be careful and lick the boots of our money master because China holds a trillion dollars of the US debt. And as one person commented in the comments section... "and who is it that approved China loaning us the trillion dollars?"

Can anyone say "the chickens are here!"

Brother Mark
Jan 18th 2011, 05:15 PM
The only reason China can even manipulate their currency is because of US deficit spending. If the government stopped deficit spending, then the yuan would increase in value because China would no longer be able to hide those dollars in bonds and instead would have to purchase goods and services with them. The trade deficit would go down and the dollar would go down against the yuan.

ProjectPeter
Jan 18th 2011, 05:25 PM
It would certainly help. I do find humor in hearing them holler now though! The only problem with the last election... there wasn't enough of the bums thrown out... talking all the parties too. :)

Brother Mark
Jan 18th 2011, 05:48 PM
Well, there's always 2012. 2010 was the most important election in my lifetime, IMO. 2012 will be the same. If we don't change direction then, we will unlikely be able to be as great as we once were as a nation.

The way China keeps their currency low is by buying bonds with excess dollars which props the dollar up and by printing yuans. The two actions together make it easy for them to peg their currency against ours. That said, I don't mind them subsidizing my purchasing power by printing more yuan. That would eventually cause them major grief if they were to have only that tool. But because they can buy the bonds with dollars we give them through trade, that guarantees a trade deficit which would ordinarily put pressure on the dollar to go lower and the yuan to go higher. Our deficit is simply out of control and most don't care.

The average family in the US now owes over $500,000 in taxes just to meet our debt and future debt obligations. It simply won't happen because it can't happen. Eventually when folks figure it out, it will get real ugly here.