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03-03-2009, 12:39 AM
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again sorta not -
03-03-2009, 12:49 AM
The Effect of the Crisis on the U.S.-China Economic Relationship
China's Economy, China, Global Economics, Global Financial Crisis, U.S. Economy Eswar Prasad, Senior Fellow, Global Economy and Development U.S.-China Economic and Security Review Commission Feb 17/2009 Whatever one’s view about the centrality of these imbalances versus problems in the U.S. financial system in triggering the crisis, there is no doubt that global imbalances allowed problems in the U.S. financial system to fester and end in a cataclysm. More importantly, the underlying policies that generated those imbalances were clearly not in the long-term interests of the countries concerned themselves. A looming problem is that these imbalances could actually worsen over the short term, perpetuating macroeconomic problems in the main economies and possibly setting the stage for the global economy to take another tumble in the future. "The US is the ultimate financial safe haven, with the flight to quality around the world turning into a flight to U.S. treasury bonds." Indeed, there is a rich set of ironies in the way the crisis has played out. First, the global macro imbalances are not unraveling in the way that most economists had expected. Rather than adjusting via a decline in the external value of the dollar, the U.S. current account deficit may apparently adjust with just a massive contraction in private consumption.[4] Second, the U.S., which has been at the epicenter of the crisis, has become the ultimate financial safe haven, with the flight to quality around the world turning into a flight to U.S. treasury bonds. Third, and most worryingly, the rest of the world still seems to be counting on the U.S. as a demander of last resort. Fourth, all signs are that the global crisis may lead to emerging markets rethinking old notions of reserve adequacy and consider building up even larger stocks of reserves.
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03-03-2009, 12:56 AM
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Going back to economics, I don't see how US can sustain this unlimited borrowing forever. This 1.7 trillion dollar budget deficit that Obama is running, is China going to foot that entire bill? And will it really save the US economy? So far all directions are pointing towards propping up demand and saving corporate America's behind, that's socialism for you right there. Capitalism cannot work without failures. China is between a rock and a hardplace. It has 700 Billion and counting worth of US debt. If she refuses to buy more and start dumping US treasury, the US dollar is going down the toilet and China can kiss goodbye to those 700 Billion. If she does buy more, she is supporting the US dollar but really she is using good money to chase after the bad. The options are not pretty neither way. I don't think China has a choice. It is not buying US treasury because it's any GOOD, it's because they have such a vested interest in it that they have no choice! As luo ping, director general of China Banking Regulatory Commission said last month: "We hate you guys. Once you start issuing $1 trillion-$2 trillion [$1,000bn-$2,000bn] . . . we know the dollar is going to depreciate, so we hate you guys but there is nothing much we can do." The only way for this to pan out is for US to lower it's consumption, get off their butts and start exporting to pay back this debt. Instead, the government is encouraging consumption, i.e. getting yourself into bigger debt. I just want to know how on earth will the US pay off $11 Trillion.
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again mistaken China credit and trade def. -
03-03-2009, 01:12 AM
The Effect of the Crisis on the U.S.-China Economic Relationship
China's Economy, China, Global Economics, Global Financial Crisis, U.S. Economy Eswar Prasad, Senior Fellow, Global Economy and Development U.S.-China Economic and Security Review Commission Trade and Financial Linkages between the U.S. and China Trade between the two economies has continued to increase in volume and the U.S. remains one of China’s major export markets. Chinese exports to the U.S. rose from $100 billion in 2000 to $338 billion in 2008, while imports rose from $16 billion to $71 billion. Interestingly, however, the share of China’s exports going to the U.S. has actually declined over time, from about 22 percent in 2000 to 19 percent in 2007, roughly the same share as that of the European Union.[1] China’s bilateral trade surplus with the U.S. has risen from about $84 billion in 2000 to nearly $266 billion in 2008 (about 1.9 percent of U.S. GDP). The Effect of the Crisis on the U.S.-China Economic Relationship China's Economy, China, Global Economics, Global Financial Crisis, U.S. Economy Eswar Prasad, Senior Fellow, Global Economy and Development U.S.-China Economic and Security Review Commission To combat the effects of the slowdown, the Chinese government recently announced an aggressive fiscal stimulus. The net effect of this package in terms of new spending is likely to be on the order of 4-5 percent of GDP, much smaller than the headline number that was announced (about 16 percent of GDP) but still quite impressive. Much of this expenditure will go towards investment projects and partly towards strengthening the social safety net. It is a package that tries to blend together short-term stimulus with longer-term objectives of developing infrastructure in underdeveloped parts of the country (particularly the provinces in the west) and boosting consumption. However, Chinese household savings have been on a trend increase in recent years and the economic uncertainty is likely to increase saving for precautionary purposes.[7] Thus, the fiscal stimulus could end up actually worsening the balance of growth by tilting it even more towards growth led by investment and exports rather than private consumption. The reliance on exports is, as noted earlier, because it is a key source of job growth. Even if China continues to rely on exports for growth, the recession and the rebuilding of household balance sheets in the U.S. implies that Chinese exports to the U.S. will almost certainly decline during 2009. Thus, the overall volume of trade between the two economies is likely to fall in tandem with the sharp fall in global trade. The U.S. bilateral trade deficit with China could still remain in the range of about $200 billion in 2009, especially if the U.S. fiscal stimulus generates a gradual recovery in U.S. domestic demand. China’s overall current account balance, which is estimated to be about $370 billion (roughly 9 percent of GDP) in 2008, could well remain in the $300-350 billion range; the recent collapse in exports has been offset by an even sharper decline in imports.
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03-03-2009, 01:17 AM
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03-03-2009, 05:00 AM
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Also your circus/bread thing is getting old and is so simplistic. I'll leave you to your simple metaphors. I've already dismissed it in the case of Constitutional Democracy (The idea being that essentially power rests with the citizens so if anybody is giving anyone "bread" it is ourselves). When you're ready to discuss the complexities of the topic using real terms then I'll be happy to continue.
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03-03-2009, 06:24 AM
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If free speech is so important, why doesn't Hiliray Clinton clamp on China for "human right" violations instead of begging like a dog for more $$. So if life is so great in free speech NZ, why aren't Singaporeans escaping authoritarian Singapore to sheep land. Why is Singapore on the US visa waiver program? Wouldn't everyone just flee to free America? It does not make any sense. My argument is simple, economics rules above people running their mouths. What is human right is the right to be educated, and the right to be fed. There are a lot of countries that can't even get these 2 things right for the majority but they have ample of free speech rights, i.e. they can run their mouth all day. India comes to mind. But do people have good quality of life there? I doubt it (not the majority at least). Have you been to China/India/Singapore? I've been to all of those places, I know the difference first hand. Ronin, you and many others like you are promoting an ideology that is a luxury, not an necessity. What better example than the US's priorities right now. In the end, I like to conclude that economic growth comes from competent leadership, there is no subsitute. Btw I have been to Wellington, beautiful city, sea on one side, hill on the opposite and I loved the cable cars  .
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03-03-2009, 07:41 AM
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You talk as though the two are mutually exclusive and inherently at odds with each other. You cannot excuse oppression for the sake of economic stability. Either in theory or in the case of Tibet. It makes no logical sense. I may be promoting an ideology but so are you. You are blind to think otherwise.
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03-03-2009, 07:51 AM
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Put it another way, if you had to choose between running your mouth or getting fed, which one would you choose? I can tell you now you won't even last 3 days running your mouth with no food. If you still don't get it, or it's too hard for you, you can dismiss everything I say as irrelevant, I don't care. Go read up on economics 101. Not once was freedom of speech part of ANY economic text book. And yes i majored in economics and finance. You obviously never been to any of the countries I talked about either judging by your lack of reply. I'd rather live in oppressive China and getting clothes and fed than free Indian slum (no offense to any Indians). But if you prefer the opposite, that's your lifestyle decision.
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03-03-2009, 07:59 AM
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What sort of threat did Tibet pose in the 1950's to China's economic and social stability? The only thing your empirical evidence proves is that Democracy alone can't fix economic instability. I never meant to imply it could. But to assume that it inherently hinders it is false.
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