When will China call our note?
73- rhamson
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For years the US has been setting up businesses in China and trading at a deficiet for the last few. China has accepted our credit and continued to loan us money to carry on wars and other policy while the debt accrues. If the Euro replaces the dollar such as is the movement in the middle east and Europe, will the Chinese call us on our debt or worse yet trade the debt for Euros and take the loss?
- C.J. Wright
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rhamson wrote:
For years the US has been setting up businesses in China and trading at a deficiet for the last few. China has accepted our credit and continued to loan us money to carry on wars and other policy while the debt accrues. If the Euro replaces the dollar such as is the movement in the middle east and Europe, will the Chinese call us on our debt or worse yet trade the debt for Euros and take the loss?
Simply calling the debt would do nothing for china. China is getting exactly what it wants from us, oil rights off our coast line. I don't think they will rock the boat. If they were to do anything it would be your latter sugestion.
84- tksensei
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No, they won't.
- 73
- rhamson
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C.J. Wright wrote:
rhamson wrote:
For years the US has been setting up businesses in China and trading at a deficiet for the last few. China has accepted our credit and continued to loan us money to carry on wars and other policy while the debt accrues. If the Euro replaces the dollar such as is the movement in the middle east and Europe, will the Chinese call us on our debt or worse yet trade the debt for Euros and take the loss?
Simply calling the debt would do nothing for china. China is getting exactly what it wants from us, oil rights off our coast line. I don't think they will rock the boat. If they were to do anything it would be your latter sugestion.
What kind of scenario would you anticipate with the latter?
- 73
- rhamson
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tksensei wrote:
No, they won't.
What makes you so sure?
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
86- Poppa Blues
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I think they might, and even if they don't, they may decide not to buy anymore USA debt, and that could be just as bad!
Our economy continues to tank. As it does so, consumers are holding back on purchases, which isn't helping China at all!
The treasury continues to print money to finance the outlandish spending of this administration. We are being steered towards an economic collapse all in the name of power! I don't think the risk has ever been greater!
96- ryankett
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The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
No, most of the developed world is 'shoring up their economy', not just America. America is important to China, but Europe is equally if not more important as an export market. I agree that America is still too important to China right now though, they were shook by the financial crisis, the only problem will be if protectionism hits in.
If America stops buying, China will call in debts, its a vicious circle for you. I would suggest withdrawing from the pointless war in Afghanistan, at which point you can buy your tacky plastics from China whilst managing your debts. Same applies to the UK, we need to do the same.- C.J. Wright
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rhamson wrote:
C.J. Wright wrote:
rhamson wrote:
For years the US has been setting up businesses in China and trading at a deficiet for the last few. China has accepted our credit and continued to loan us money to carry on wars and other policy while the debt accrues. If the Euro replaces the dollar such as is the movement in the middle east and Europe, will the Chinese call us on our debt or worse yet trade the debt for Euros and take the loss?
Simply calling the debt would do nothing for china. China is getting exactly what it wants from us, oil rights off our coast line. I don't think they will rock the boat. If they were to do anything it would be your latter sugestion.
What kind of scenario would you anticipate with the latter?
I don't think they want to do it. I say that because while they hold the note, they can use it as leverage. We can't get tough on trade, we can't stop them from drilling off our shores. If they do it it will be because they truly believe the dollar is done for, as far as world currency goes. Now to determine what their beliefs are, one should closely monitor how they are hedging. If they substantialy increase their holdings in precious metals....look out. So will they outright call the note? No. What they will do is double down on gold, dump the dollar for euros and therefore drive a stake through the heart of the dollar.
- 96
- ryankett
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ryankett wrote:
The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
No, most of the developed world is 'shoring up their economy', not just America. America is important to China, but Europe is equally if not more important as an export market. I agree that America is still too important to China right now though, they were shook by the financial crisis, the only problem will be if protectionism hits in.
If America stops buying, China will call in debts, its a vicious circle for you. I would suggest withdrawing from the pointless war in Afghanistan, at which point you can buy your tacky plastics from China whilst managing your debts. Same applies to the UK, we need to do the same.And I saw my first example of 'protectionism' today..... a large local warehouse has announced that all 200 of its non-British workers will cease to be in employment after christmas. Those jobs will then be given to British citizens, thus 200 eastern europeans will be on boats home.... and money will remain in the local economy.
I am in the UK of course, but that is a very good start, about 1 million more polish to go home..... and 1 million British people come off benefits. Poppa Blues wrote:
I think they might, and even if they don't, they may decide not to buy anymore USA debt, and that could be just as bad!
Our economy continues to tank. As it does so, consumers are holding back on purchases, which isn't helping China at all!
Excellent point. I'd agree if I didn't see a trend in larger businesses to just look for cheaper ways to produce and different products to produce rather than to stop production. World economies are tanking but less so from consumption than pricing and quality which is causing different choices to be made. On your other note, it is very possible that they may decide not to buy anymore USA debt which is a whole different conversation.
- 73
- rhamson
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The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
That sounds well and fine in a strong economy but the economy is weak and in some cases goods have been sent back for credit. The US consumer is supported by the jobs we hold and those are disapearing very quickly. If we cannot afford to buy even the cheapest Chinese goods because of our lack of money, would it change the attitude of the Chinese?
- 73
- rhamson
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ryankett wrote:
ryankett wrote:
The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
No, most of the developed world is 'shoring up their economy', not just America. America is important to China, but Europe is equally if not more important as an export market. I agree that America is still too important to China right now though, they were shook by the financial crisis, the only problem will be if protectionism hits in.
If America stops buying, China will call in debts, its a vicious circle for you. I would suggest withdrawing from the pointless war in Afghanistan, at which point you can buy your tacky plastics from China whilst managing your debts. Same applies to the UK, we need to do the same.And I saw my first example of 'protectionism' today..... a large local warehouse has announced that all 200 of its non-British workers will cease to be in employment after christmas. Those jobs will then be given to British citizens, thus 200 eastern europeans will be on boats home.... and money will remain in the local economy.
I am in the UK of course, but that is a very good start, about 1 million more polish to go home..... and 1 million British people come off benefits.Will the British citizens be able to make a living wage replacing these deported workers? Here in the US most low paying jobs are taken by illegal immigrant workers because their jobs don't pay enough for American workers to live on. Interesting internal solution I must say.
- 73
- rhamson
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C.J. Wright wrote:
rhamson wrote:
C.J. Wright wrote:
Simply calling the debt would do nothing for china. China is getting exactly what it wants from us, oil rights off our coast line. I don't think they will rock the boat. If they were to do anything it would be your latter sugestion.What kind of scenario would you anticipate with the latter?
I don't think they want to do it. I say that because while they hold the note, they can use it as leverage. We can't get tough on trade, we can't stop them from drilling off our shores. If they do it it will be because they truly believe the dollar is done for, as far as world currency goes. Now to determine what their beliefs are, one should closely monitor how they are hedging. If they substantialy increase their holdings in precious metals....look out. So will they outright call the note? No. What they will do is double down on gold, dump the dollar for euros and therefore drive a stake through the heart of the dollar.
With our economic instability do you think the Chinese are already looking to dump the dollar as are the Saudis? It makes perfect sense to align the two together (energy and debt) with Euros as they will then be on the same debt scale and create a feasible debt sale if needed.
rhamson wrote:
The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
That sounds well and fine in a strong economy but the economy is weak and in some cases goods have been sent back for credit. The US consumer is supported by the jobs we hold and those are disapearing very quickly. If we cannot afford to buy even the cheapest Chinese goods because of our lack of money, would it change the attitude of the Chinese?
Notice in my response to PBlues, it's all about choices. Peoples choices are changing. How many ads have you seen recently about how to have fun staying at home? Yard games and local park attendance is way up. Rather than spend thousands going on trips, people stay home but they still need entertainment. They are buying less expensive items to have fun at home - frisbees, lawn slides and bikes are all enjoying better numbers. Have you seen the stats for attendance at football games? Attendance is down but viewing is way up - and so are satellite subscriptions. Restaurants are closing in droves but grocery stores are seeing an increase in store brand buying. Yes, consumption is down but not by much when you view the full picture. Things being sent back to the factories are because choices are changing.
- C.J. Wright
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rhamson wrote:
C.J. Wright wrote:
rhamson wrote:
What kind of scenario would you anticipate with the latter?I don't think they want to do it. I say that because while they hold the note, they can use it as leverage. We can't get tough on trade, we can't stop them from drilling off our shores. If they do it it will be because they truly believe the dollar is done for, as far as world currency goes. Now to determine what their beliefs are, one should closely monitor how they are hedging. If they substantialy increase their holdings in precious metals....look out. So will they outright call the note? No. What they will do is double down on gold, dump the dollar for euros and therefore drive a stake through the heart of the dollar.
With our economic instability do you think the Chinese are already looking to dump the dollar as are the Saudis? It makes perfect sense to align the two together (energy and debt) with Euros as they will then be on the same debt scale and create a feasible debt sale if needed.
The Saudi's don't trust communist countries. Look at what the USSR did to so many Muslim countries.....
The Saudi's will buy gold, Middle eastern countries always have. Its hard to get a take on how much because their holdings are not transparent. They will remain mostly loyal to the US as long as we provide stability. The Saudi's are the greatest beneficaries of the stability(what little there is) provided by the US.
China, seems more interested in going after the oil in Iraq. We paid for it in blood, they are buying it in Yuan.- 73
- rhamson
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The Rope wrote:
rhamson wrote:
The Rope wrote:
Not at all, we are shoring up their economy with all the products we are bringing into the US that are produced in China.
That sounds well and fine in a strong economy but the economy is weak and in some cases goods have been sent back for credit. The US consumer is supported by the jobs we hold and those are disapearing very quickly. If we cannot afford to buy even the cheapest Chinese goods because of our lack of money, would it change the attitude of the Chinese?
Notice in my response to PBlues, it's all about choices. Peoples choices are changing. How many ads have you seen recently about how to have fun staying at home? Yard games and local park attendance is way up. Rather than spend thousands going on trips, people stay home but they still need entertainment. They are buying less expensive items to have fun at home - frisbees, lawn slides and bikes are all enjoying better numbers. Have you seen the stats for attendance at football games? Attendance is down but viewing is way up - and so are satellite subscriptions. Restaurants are closing in droves but grocery stores are seeing an increase in store brand buying. Yes, consumption is down but not by much when you view the full picture. Things being sent back to the factories are because choices are changing.
I agree that this is somewhat of a trend. But there are still so many unemployed that are still collecting benefits to fuel these downsized choices. When the benefits run out there will be a greater downturn in purchasing and with permanant loss of domestic jobs the difference will not be made up. When should Chine make a move to cut their losses and get back in positive growth with other nations that have a Euro based economy? Holding debt with a dead debt laden economy such as ours is a bad business choice. And with the large consumption of the US in the dump can only convince the Chinese that cutting their losses and seeking greener pastures is a good move.
- 73
- rhamson
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C.J. Wright wrote:
rhamson wrote:
C.J. Wright wrote:
I don't think they want to do it. I say that because while they hold the note, they can use it as leverage. We can't get tough on trade, we can't stop them from drilling off our shores. If they do it it will be because they truly believe the dollar is done for, as far as world currency goes. Now to determine what their beliefs are, one should closely monitor how they are hedging. If they substantialy increase their holdings in precious metals....look out. So will they outright call the note? No. What they will do is double down on gold, dump the dollar for euros and therefore drive a stake through the heart of the dollar.With our economic instability do you think the Chinese are already looking to dump the dollar as are the Saudis? It makes perfect sense to align the two together (energy and debt) with Euros as they will then be on the same debt scale and create a feasible debt sale if needed.
The Saudi's don't trust communist countries. Look at what the USSR did to so many Muslim countries.....
The Saudi's will buy gold, Middle eastern countries always have. Its hard to get a take on how much because their holdings are not transparent. They will remain mostly loyal to the US as long as we provide stability. The Saudi's are the greatest beneficaries of the stability(what little there is) provided by the US.
China, seems more interested in going after the oil in Iraq. We paid for it in blood, they are buying it in Yuan.Granted we are the biggest customer of the Saudi oil but Europes currency is much more stable than ours. The Saudis are beginning a slow trasition from oil as are other countries in the region. You see more and more real estate world wide going into Saudi hands as well as banking and industry. With this movement they are exposing themselves to greater risk by not trading in Euros and stabilizing their wealth. The Chinese while not having an oil based transition to go through have a more immediate crisis on their hands. Holding our debt with US dollars is highly risky and small losses now are more sustainable by buying Euros than they will be when there is a glut of useless US dollars to settle with.
- C.J. Wright
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rhamson wrote:
C.J. Wright wrote:
rhamson wrote:
With our economic instability do you think the Chinese are already looking to dump the dollar as are the Saudis? It makes perfect sense to align the two together (energy and debt) with Euros as they will then be on the same debt scale and create a feasible debt sale if needed.The Saudi's don't trust communist countries. Look at what the USSR did to so many Muslim countries.....
The Saudi's will buy gold, Middle eastern countries always have. Its hard to get a take on how much because their holdings are not transparent. They will remain mostly loyal to the US as long as we provide stability. The Saudi's are the greatest beneficaries of the stability(what little there is) provided by the US.
China, seems more interested in going after the oil in Iraq. We paid for it in blood, they are buying it in Yuan.Granted we are the biggest customer of the Saudi oil but Europes currency is much more stable than ours. The Saudis are beginning a slow trasition from oil as are other countries in the region. You see more and more real estate world wide going into Saudi hands as well as banking and industry. With this movement they are exposing themselves to greater risk by not trading in Euros and stabilizing their wealth. The Chinese while not having an oil based transition to go through have a more immediate crisis on their hands. Holding our debt with US dollars is highly risky and small losses now are more sustainable by buying Euros than they will be when there is a glut of useless US dollars to settle with.
Notice the trend? Tangibles...that's were its at! The only paper realy worth anything is a DEED!
- 73
- rhamson
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C.J. Wright wrote:
rhamson wrote:
C.J. Wright wrote:
The Saudi's don't trust communist countries. Look at what the USSR did to so many Muslim countries.....
The Saudi's will buy gold, Middle eastern countries always have. Its hard to get a take on how much because their holdings are not transparent. They will remain mostly loyal to the US as long as we provide stability. The Saudi's are the greatest beneficaries of the stability(what little there is) provided by the US.
China, seems more interested in going after the oil in Iraq. We paid for it in blood, they are buying it in Yuan.Granted we are the biggest customer of the Saudi oil but Europes currency is much more stable than ours. The Saudis are beginning a slow trasition from oil as are other countries in the region. You see more and more real estate world wide going into Saudi hands as well as banking and industry. With this movement they are exposing themselves to greater risk by not trading in Euros and stabilizing their wealth. The Chinese while not having an oil based transition to go through have a more immediate crisis on their hands. Holding our debt with US dollars is highly risky and small losses now are more sustainable by buying Euros than they will be when there is a glut of useless US dollars to settle with.
Notice the trend? Tangibles...that's were its at! The only paper realy worth anything is a DEED!
I agree but even that is dependent on its location.
