Re: Euro =1.43 Dollar ->Dump monopoly money (USD), China!

david_huang2007@xxxxxxxxxxx wrote:
On Oct 23, 2:47 am, Les Cargill <lcarg...@xxxxxxxxxx> wrote:
david_huang2...@xxxxxxxxxxx wrote:
http://www.abcnews.go.com/Business/wireStory?id=3721104
<snip>

The crux of the hypocrisy is that while the US uses the WTO provisions
in order to urge China to open its financial sector to outside (read:
mainly US-based) investment, it lets other countries such as Canada or
Australia to restrict foreign ownership, in direct violation for
existing Free-trade agreements with these countries, and get away with
it. And two years ago, when we were attempting to buy a medium-side US-
based oil company you raised stench to high heaven and we had to
eventually back off. ("National security" grounds, my a$$).
No, that's about right. Mineral reserves on the ground in the US
can be governed by national security policy left over from WWII.

You know what? You've been enjoying our free lunch for way too long.
Unless you learn to shut up and be humble, and stop making China into
your own scape goat, let's see what's gonna happen if we dump all our
dollar reserves and invest in the Euro. I'm sure France and Germany
are much more receptive to Chinese investment, whine less about our
environmental record (as if you implemented Kyoto!!!). And we'll see
how you'll function after we get rid of our dollar T-bonds. And with
your already falling dollar, I'd rather buy Euros anyway.
Go for it. It's headed that way anyhow. And when you take back
Euro denominated bonds in exchange for Chinese goods, what happens
to the exchange rate of the dollar and Euro?

What might happen, also corroborated by Alan Greespan and other
renowned economists, is that the US inflation rate would shoot up to
the sky; right now people are talking about the record wheat prices
due to climate change, which combines with the ethanol boom to spike
almost every grocery staple sky-high; plus the price of oil and gas is
hitting $90.

The sheep are nervous. Core inflation isn't "shooting to the sky" and
it's not likely to. And you avoided my actual question - there is not
a reason in the world to think that what has happened to the dollar
will not happen to the Euro then.

Our convoluted and bizarre subsidy policies wrt wheat production
guarantee below market prices for direct consumers of wheat; ditto
corn, any bulk staple. See "King Corn" for details... the
money's all in processed foods, something the French have
learned.

Oil prices needed to go up for a very long time. Only low oil
prices as an electoral gambit kept them low.

What you see now is a nostalgia-based "stagflation". The Baby
Boomers are getting old.

You think That's inflation? wait till we pull our dollar
reserves (1.45 trillion of them),

And do what with them? Use them as fertilizer? Use them to
dilute some other currency? Like the Euro? Isn't that
what I said you'd do?

and you'll see almost overnight an
interest rate jump of at least .75%. You really need it right now with
all the subprime mortgage mess going right now.


Oh, I think we needed it 5 years ago. I think that at least a *point*
of additional inflation from 1996 to the present would have been
very healthy indeed. You've misread your USAian demographics.

But it's suicide at election time to embrace inflation. *Shrug*.


David Huang

:)

But yeah - media outlets in the US cannot avoid Yellow Peril
nonsense. Worked for Hearst, works now.


Les Cargill



--
Les Cargill
.

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