The next global bubble: China

Sungodbr

China, who have had a growth rate of 8%-10% growth for 30 years which has helped vastly grow resource rich countries such as Australia, Russia, Brazil and NZ and quickly get them out of the global recession in a lot better shape than the US and Europe, but looks like there seems to be trouble ahead as spiraling real estate and inflation on goods such as food in China, which has food prices increasing at rates of 8%. A Time analyst is suggesting that there may be an almighty bubble growing in the second largest, soon to be the largest, economy on the planet. Can the Chinese cool this down and manage the bubble or are we due a second major world depression like the one cause by the US sub prime property crisis and what ensued from that? Can strict government control in China do what all us Europeans and Americans couldnt even see was happening? They are trying to apply the brakes but is it too late and will Oz and NZ, Russia Brazil etc who were largely unaffected in the global recession feel the deep pain soon in the next global crisis or is this a storm in a Chinese tea cup Discuss...

kfallon

At least China still have the best contraception in the world.......ugly women :pac:

Sungodbr

kfallon wrote: »

At least China still have the best contraception in the world.......ugly women :pac:

Ah Ron Atkinson the tactician!

kowloon

Does China still own the US these days?

starbelgrade

kfallon wrote: »

At least China still have the best contraception in the world.......ugly women :pac:

A Chinese woman was very distraught at the fact that she had not had a date or any sex in quite sometime. She was afraid that there might be something wrong with her, so she decided to employ the medical expertise of a sex therapist. Her doctor recommended that she go see Dr. Chang, the well known Chinese sex therapist, so she did.

Upon entering the examination room, Dr. Chang said, "OK, take off all you crose."

The woman did as she was told.

Now, get down and craw reery reery fass to odder side of room."
Again, the woman did as she was instructed.

Dr. Chang then said, "OK, now craw reery reery fass back to me."

So she did.

Dr. Chang slowly shook his head and said, "Your probrem vewy bad. You haf Ed Zachary Disease, worse case I ever see, dat why you not
haf sex or dates." Confused, the woman asked, "Oh my God, Dr. Chang, what
is Ed Zachary disease?"

Dr. Chang looked the woman in the eyes and replied, "Ed Zachary disease is when your face rook Ed Zachary rike your ass."

Sea Sharp

When they inflate themselves to the point that the cheap sh1t they produce and sell to everyone else is no longer cheap, then they are screwed.

parker kent

All this has happened before, all this will happen again.

x in the city

China has some very beautiful women, certainly compared to the obese chain smoking and mcdonalds generation on this side of the world

Sungodbr

kowloon wrote: »

Does China still own the US these days?

ye the US owes china nearly a 1 trillion $ of the 14 trillion $ it owes altogether, China loves having the US by the balls!! And the Americans are squrimin uncomfortably as the Sino money lenders hold all the chips!

Quiet you

The thing about China is its governemnt is mainly made up of engineers and economists. That means that they actually understand the issues facing their country and, more importantly, to the countries they export to. That coupled with the power to force all home grown business to sing to the same tune means they probably won't fall into the same hole as us.
Deregulation is what got the free economy into the state its in at the moment and there is no sign of the government in China giving free reign to its economy.

jd007

Might as well get this out the way early...




The chinese, a great bunch of lads.

Cavehill Red

You only think we had a property bubble. You should have a look at how property prices in Shenzhen or Shanghai have gone in the past decade.
China's been effectively importing inflation, and it's gone straight into property and to a much lesser extent, its stock market.
When this one blows, and it will, it will be absolutely spectacular, and will have global ramifications.

Ghost Estate

Cavehill Red wrote: »

You only think we had a property bubble. You should have a look at how property prices in Shenzhen or Shanghai have gone in the past decade.
China's been effectively importing inflation, and it's gone straight into property and to a much lesser extent, its stock market.
When this one blows, and it will, it will be absolutely spectacular, and will have global ramifications.

i'll have the popcorn ready then

can't wait to see those Communist bastards and their great firewall of china go down

Cavehill Red

Ghost Estate wrote: »

i'll have the popcorn ready then

can't wait to see those Communist bastards and their great firewall of china go down

They'll bring the US down with them, and the US will bring us down if it isn't averted.
Enjoy your popcorn.

Bubbles all over the world! European ones - popped; US ones - popped; Chinese ones - overinflated!

Where next after this one pops, India?

Ghost Estate

Ghost Estate wrote: »

i'll have the popcorn ready then

can't wait to see those Communist bastards and their great firewall of china go down

When China goes pop! The supply of cheap goods will dwindle, we have "exported" much of our industry, so will not be able to quickly replace those goods with locally made ones. When we do, they'll cost at least 50% more, goodbye consumarism!

enda1

x in the city wrote: »

China has some very beautiful women, certainly compared to the obese chain smoking and mcdonalds generation on this side of the world

But isn't that exactly what the current generation of Chinese are being accused of??

Sungodbr

Cavehill Red wrote: »

You only think we had a property bubble. You should have a look at how property prices in Shenzhen or Shanghai have gone in the past decade.
China's been effectively importing inflation, and it's gone straight into property and to a much lesser extent, its stock market.
When this one blows, and it will, it will be absolutely spectacular, and will have global ramifications.

Im glad all the irish money is gone or the irish lunatics would probably be buying up all the properties in rural Chongqing district the way we did in rural Bulgaria at the start of the decade, imagine Paddy down the road, "I just got myself a lovely one bed in Beijing" "and ye get a free bicycle with it, well worth it"

On another note their must now be more than 9 million bicycles in Beijing?

Lumen

When they start to stop buying our debt we will start to stop buying their stuff with our debt. Then they will have even less "money" to buy our debt, and we will have less debt with which to buy their stuff...

And then somewhere down the line, this.

msg11

Send in Finna Fail they will do an excellent job for them in cooling down the situation.

Amhran Nua

Sungodbr wrote: »

ye the US owes china nearly a 1 trillion $ of the 14 trillion $ it owes altogether, China loves having the US by the balls!! And the Americans are squrimin uncomfortably as the Sino money lenders hold all the chips!

7% of total national debt isn't holding anyone by the balls.

Quiet you wrote: »

The thing about China is its governemnt is mainly made up of engineers and economists.

No, its made of of army guys and party hacks.

I don't know where the OP/article is getting the idea that China has been keeping anyone afloat, the major export destinations are developed western countries.

Saila

Lumen wrote: »

When they start to stop buying our debt we will start to stop buying their stuff with our debt. Then they will have even less "money" to buy our debt, and we will have less debt with which to buy their stuff...

And then somewhere down the line, this.

:eek: its 2012! it all makes sense now!

Mister men

kfallon wrote: »

At least China still have the best contraception in the world.......ugly women :pac:

I take it you have'nt been around and about Dublin of recent.

msg11

Saila wrote: »

:eek: its 2012! it all makes sense now!

Nah mate it's still 2010 another two years just yet.

Coriolanus

I'd be more worried about the growing dearth of young marriagable women. Map took advantage of a similar disparity to raise numbers for the cultural revolution. 100m plus young men with little education, no job and no wife?

Sungodbr

Amhran Nua wrote: »

7% of total national debt isn't holding anyone by the balls.

According to the "Washington Post," China became the largest foreign creditor to the U.S. in November 2008. Because of this, China has great influence over the American economy. Should China choose to stop buying U.S. debt, it would cease one of the largest in-flows of capital into the country, making it harder for businesses to obtain loans and raising interest rates and commodity prices for consumers. If China were to begin selling U.S. debt--essentially cashing in its government bonds--it would actually remove money from the U.S. economy, creating an even more dire situation.

Read more: Why Does China Buy U.S. Debt? | eHow.com http://www.ehow.com/about_4618388_does-china-buy-us-debt.html#ixzz17bWi525V

Sounds like some people in the know in the US are worried thou that they own too much US debt

Cavehill Red

The issue isn't so much whether China will keep buying US debt. It's whether they'll flood the market with dollars, which would crash the US economy by doubling up on Bernanke's QE printing press in a period of deflation.

Lumen

Nevore wrote: »

I'd be more worried about the growing dearth of young marriagable women. Map took advantage of a similar disparity to raise numbers for the cultural revolution. 100m plus young men with little education, no job and no wife?

Confucius say: many men can happily share one bicycle, but it is more comfortable for only one to ride at a time.

Canis Lupus

starbelgrade wrote: »

A Chinese woman was very distraught at the fact that she had not had a date or any sex in quite sometime. She was afraid that there might be something wrong with her, so she decided to employ the medical expertise of a sex therapist. Her doctor recommended that she go see Dr. Chang, the well known Chinese sex therapist, so she did.

Upon entering the examination room, Dr. Chang said, "OK, take off all you crose."

The woman did as she was told.

Now, get down and craw reery reery fass to odder side of room."
Again, the woman did as she was instructed.

Dr. Chang then said, "OK, now craw reery reery fass back to me."

So she did.

Dr. Chang slowly shook his head and said, "Your probrem vewy bad. You haf Ed Zachary Disease, worse case I ever see, dat why you not
haf sex or dates." Confused, the woman asked, "Oh my God, Dr. Chang, what
is Ed Zachary disease?"

Dr. Chang looked the woman in the eyes and replied, "Ed Zachary disease is when your face rook Ed Zachary rike your ass."

I don't understand why two Chinese people are talking in English.

Lumen

Canis Lupus wrote: »

I don't understand why two Chinese people are talking in English.

Those are just the subtitles.

kfallon

x in the city wrote: »

China has some very beautiful women, certainly compared to the obese chain smoking and mcdonalds generation on this side of the world

Lack of 'boobage' will always count against them tho :pac:

ToniTuddle

Sungodbr wrote: »

? They are trying to apply the brakes but is it too late and will Oz and NZ, Russia Brazil etc who were largely unaffected in the global recession feel the deep pain soon in the next global crisis or is this a storm in a Chinese tea cup Discuss...

It better not affect Oz or NZ I'm going back out there in 2 or 3 years when I can afford to get the hell out of here!!

Biggins

I'd still be more worried about America to be honest, before China's decline comes.
America's downfall is continuing.

Cavehill Red

ToniTuddle wrote: »

It better not affect Oz or NZ I'm going back out there in 2 or 3 years when I can afford to get the hell out of here!!

It's already affecting both. They were largely insulated from the global downturn because they were banging out raw resources to fuel China. When China stops buying, they'll slump too. And they've already slowed down.

Amhran Nua

Sungodbr wrote: »

According to the "Washington Post," China became the largest foreign creditor to the U.S. in November 2008.

Which is still only seven percent. Thats not nothing, but its not much at all when you look at the bigger picture.

Sungodbr wrote: »

Because of this, China has great influence over the American economy. Should China choose to stop buying U.S. debt, it would cease one of the largest in-flows of capital into the country, making it harder for businesses to obtain loans and raising interest rates and commodity prices for consumers.

Since China is finding it more or less impossible to run its two rates, one currency scheme these days, it needs to buy foreign currencies to keep its own devalued. This devaluation gives them a competitive advantage of as much as a third in some industries. If they stop that, they fall over, with widespread civil unrest at best, and industry moves on to the next low cost destination.

Sungodbr wrote: »

If China were to begin selling U.S. debt--essentially cashing in its government bonds--it would actually remove money from the U.S. economy, creating an even more dire situation.

The USD is the de facto currency for global trade, believe me it would survive just fine.

All of these factors will change over time, but the US has a great deal more power over China than China has over the US right now.

Cavehill Red

Amhran Nua wrote: »

Which is still only seven percent. Thats not nothing, but its not much at all when you look at the bigger picture.

The issue is what happens when they start selling dollars to buy other currencies and precious metals, as they are now doing. That's a bigger deal than whether they continue buying US debt.

Amhran Nua wrote: »

Since China is finding it more or less impossible to run its two rates, one currency scheme these days, it needs to buy foreign currencies to keep its own devalued. This devaluation gives them a competitive advantage of as much as a third in some industries. If they stop that, they fall over, with widespread civil unrest at best, and industry moves on to the next low cost destination.

But there isn't one with China's capacity. India doesn't have the infrastructure or resources and neither does Brazil. Russia has the tech, but not the manpower or the low wages. Everywhere else, from Africa to Asia, isn't big enough.

Amhran Nua wrote: »

The USD is the de facto currency for global trade, believe me it would survive just fine.

I beg to differ. I think the dollar is in real jeopardy currently. The Arabs don't want payment in dollars for oil anymore. The dollar is rapidly devaluing with every quantitative easing round. Historically, all unsupported fiat currencies have collapsed. Lacking backing by gold, silver or oil, the dollar too will collapse one day.

Amhran Nua wrote: »

All of these factors will change over time, but the US has a great deal more power over China than China has over the US right now.

In that I expect a Chinese economic collapse before an American one, I agree with you. But not because America holds power over China, because they don't, except as consumers whose trade deficit is so vast it can no longer be sustained anyway. China will go first because it is vastly overinflated and the fundamentals will exert a nasty shock, just as they did here.

Biggins

Amhran Nua wrote: »

The USD is the de facto currency for global trade, believe me it would survive just fine.

All of these factors will change over time, but the US has a great deal more power over China than China has over the US right now.

Nope.
You really need to do your research.
It don't dwell for a new party to be so far off the mark in such a comment.

I quote the following from an article I read (comments and research which reflect similar thinking and analysis I've come across loads of times, in the last few months alone. Never mind for the last three years):

Today, three main threats exist to America’s dominant position in the global economy: loss of economic clout thanks to a shrinking share of world trade, the decline of American technological innovation, and the end of the dollar's privileged status as the global reserve currency.

One of the reasons why Sadam was supposed REALLY brought down was that shortly before America went gung-ho, Sadam was about to convert all his monetary reserves from US dollars to Euro. Other Arab nations were/are making preparations to do the same. They see the dollar as a now failed commodity. Had Sadam survived long enough to do his dollar to Euro conversion (and others followed), the American stock market collapse would have had unlimited but by all accounts, devastating effects. But thats another whole topic in itself...

By 2008, the United States had already fallen to number three in global merchandise exports, with just 11% of them compared to 12% for China and 16% for the European Union. There is no reason to believe that this trend will reverse itself.

Similarly, American leadership in technological innovation is on the wane. In 2008, the U.S. was still number two behind Japan in worldwide patent applications with 232,000, but China was closing fast at 195,000, thanks to a blistering 400% increase since 2000. A harbinger of further decline: in 2009 the U.S. hit rock bottom in ranking among the 40 nations surveyed by the Information Technology & Innovation Foundation when it came to “change” in “global innovation-based competitiveness” during the previous decade. Adding substance to these statistics, in October China's Defense Ministry unveiled the world's fastest supercomputer, the Tianhe-1A, so powerful, said one U.S. expert, that it “blows away the existing No. 1 machine” in America.


Add to this clear evidence that the U.S. education system, that source of future scientists and innovators, has been falling behind its competitors. After leading the world for decades in 25- to 34-year-olds with university degrees, the country sank to 12th place in 2010. The World Economic Forum ranked the United States at a mediocre 52nd among 139 nations in the quality of its university math and science instruction in 2010. Nearly half of all graduate students in the sciences in the U.S. are now foreigners, most of whom will be heading home, not staying here as once would have happened. By 2025, in other words, the United States is likely to face a critical shortage of talented scientists.


Such negative trends are encouraging increasingly sharp criticism of the dollar's role as the world’s reserve currency. “Other countries are no longer willing to buy into the idea that the U.S. knows best on economic policy,” observed Kenneth S. Rogoff, a former chief economist at the International Monetary Fund. In mid-2009, with the world's central banks holding an astronomical $4 trillion in U.S. Treasury notes, Russian president Dimitri Medvedev insisted that it was time to end “the artificially maintained unipolar system” based on “one formerly strong reserve currency.”


Simultaneously, China's central bank governor suggested that the future might lie with a global reserve currency “disconnected from individual nations” (that is, the U.S. dollar). Take these as signposts of a world to come, and of a possible attempt, as economist Michael Hudson has argued, “to hasten the bankruptcy of the U.S. financial-military world order.”

Under current projections, the United States will find itself in second place behind China (already the world's second largest economy) in economic output around 2026, and behind India by 2050. Similarly, Chinese innovation is on a trajectory toward world leadership in applied science and military technology sometime between 2020 and 2030, just as America's current supply of brilliant scientists and engineers retires, without adequate replacement by an ill-educated younger generation.

By 2020, according to current plans, the Pentagon will throw a military Hail Mary pass for a dying empire. It will launch a lethal triple canopy of advanced aerospace robotics that represents Washington's last best hope of retaining global power despite its waning economic influence. By that year, however, China's global network of communications satellites, backed by the world's most powerful supercomputers, will also be fully operational, providing Beijing with an independent platform for the weaponization of space and a powerful communications system for missile- or cyber-strikes into every quadrant of the globe.

One casualty of America's waning economic power has been its lock on global oil supplies. Speeding by America's gas-guzzling economy in the passing lane, China became the world's number one energy consumer this summer, a position the U.S. had held for over a century. Energy specialist Michael Klare has argued that this change means China will “set the pace in shaping our global future.”


By 2025, Iran and Russia will control almost half of the world's natural gas supply, which will potentially give them enormous leverage over energy-starved Europe. Add petroleum reserves to the mix and, as the National Intelligence Council has warned, in just 15 years two countries, Russia and Iran, could “emerge as energy kingpins.”

Significantly, in 2008, the U.S. National Intelligence Council admitted for the first time that America's global power was indeed on a declining trajectory. In one of its periodic futuristic reports, Global Trends 2025, the Council cited “the transfer of global wealth and economic powernow under way, roughly from West to East" and "without precedent in modern history,” as the primary factor in the decline of the “United States' relative strength -- even in the military realm.”

Like many in Washington, however, the Council’s analysts anticipated a very long, very soft landing for American global preeminence, and harbored the hope that somehow the U.S. would long “retain unique military capabilities… to project military power globally” for decades to come.

http://www.alternet.org/world/149080/4_scenarios_for_the_coming_collapse_of_the_american_empire/?page=entire

Biggins

Further to the above post and to add credence to the analysis that China has already gain dominance over the USA , for example comes the following from 2005 alone (and since then things have got even worse):

Uncle Sam has reneged and defaulted on up to 40% of its trillion-dollar foreign debt, and nobody has said a word except for a line in The Economist. In plain English that means Uncle Sam runs a worldwide confidence racket with his self-made dollar based on the confidence that he has elicited and received from others around the world, and he is a also a deadbeat in that he does not honor and return the money he has received.

Uncle Sam's debt to the rest of the world already amounts to more than a third of his annual domestic production and is still growing. That alone already makes his debt economically and politically never repayable, even if he wanted to, which he does not. Uncle Sam's domestic, eg credit-card, debt is almost 100% of gross domestic product (GDP) and consumption, including that from China. Uncle Sam's federal debt is now US$7.5 trillion, of which all but $1 trillion was built up in the past three decades, the last $2 trillion in the past eight years, and the last $1 trillion in the past two years. Alas, that costs more than $300 billion a year in interest, compared with, for example, the $15 billion spent annually on the National Aeronautics and Space Administration (NASA). But no worries: Congress just raised the debt ceiling to $8.2 trillion. To help us visualize, $1 trillion tightly packed up in $1,000 bills would create a pile 100km high.

But nearly half is owed to foreigners. All Uncle Sam's debt, including private household consumer credit-card, mortgage etc debt of about $10 trillion, plus corporate and financial, with options, derivatives and the like, and state and local government debt comes to an unvisualizable, indeed unimaginable, $37 trillion, which is nearly four times Uncle Sam's GDP.

http://www.globalresearch.ca/articles/FRA501A.html

Further details as regards China's loans and those given to America amid others can be found here: http://business.inquirer.net/money/columns/view/20070909-87579/Those_ubiquitous_Chinese_loans

Such is the worry over loans alone that Obama had to give the Chinese reassurance that their loans that they got off America, would not in fact be defaulted, just last year!

http://www.businessinsider.com/henry-blodget-obama-to-china-us-wont-default-on-1-trillion-loan-2009-3

The general consensus is that between the trillions of loans - not billions - but trillions, China for all intensive effect owns America and in deed has already gained world dominance in all but name and by the back banking door!

The New York Times tried as early as 2006 to reassure it readers that everything was fairly fine (HERE) but later analysis and many, many independent outlooks said different.

In fact its got to the stage that if China stops giving loans, we are all doomed and not just the United States!

China is the single largest foreign holder of U.S. Treasury's. The money it lends to the Feds finances our significant budget deficits. (Americans have been paying about $450 billion a year in interest on the national credit card; without that debt to pay off, personal income taxes could be almost 40 percent lower.)

...This is why Secretary of State Hillary Clinton pleaded with the Chinese government last month to keep the loans flowing to Washington, D.C. ("So by continuing to support American Treasury instruments, the Chinese are recognizing our interconnection.")

This is also why, at least in part, U.S. taxpayer dollars were used to bail out Fannie Mae and Freddie Mac last year. A Business Week article says that foreign bankers were worried, especially China, which owned around $376 billion of Fannie and Freddie debt. "Treasury saw foreign governments getting the willies," a Senate aide told the magazine.

Which makes the recent flap between a U.S. Navy surveillance ship and three Chinese ships (including two fishing vessels) in the South China Sea more inexplicable than usual. Given their intertwined economies, both countries need each other more than usual right now.

http://www.cbsnews.com/8301-503983_162-4864398-503983.html

---

So to summarise, to state

The USD is the de facto currency for global trade, believe me it would survive just fine.

All of these factors will change over time, but the US has a great deal more power over China than China has over the US right now.

Well that comment alone shows a very deep, deep, misunderstanding of the current situation.
I would sincerely, seriously suggest that your people, your party down tools what ever ye are doing and for full-time for months - not reading the occasional news items and/or European summarised report in a newspaper every so often, go and bone up on the current situation in regards to the Dollar.

Your current totally misunderstand of the present situation does not inspire confidence in me to the extent yet that your organisation is a viable alternative to the current ones in terms of understand current economic overall knowledge and understanding of current financial relationships. Maybe in the future but at present, ye need to go back to school and do some learning and definitely some consistent research before speaking on such matters.

This country needs a party that understand economics in detail, not the occasional sound-bites that have been spun by those out with their own agenda!
(America trying to reassure its own and the European banking organisations, who are looking to shore up their own problems! Hell, they had to force our loans from them, down our necks - and let be honest, its really to save their European banking community, not the Irish economy as such for me and you.)

P.S. I reserve the right to be wrong and not know what the hell I'm talking about!
I'm just an average Irish person.

Ghost Estate

Cavehill Red wrote: »

They'll bring the US down with them, and the US will bring us down if it isn't averted.
Enjoy your popcorn.

We're already down and the US are shagged too, serves them right as it was the US who started giving those communists jobs in the first place.

Deleted User wrote: »

When China goes pop! The supply of cheap goods will dwindle, we have "exported" much of our industry, so will not be able to quickly replace those goods with locally made ones. When we do, they'll cost at least 50% more, goodbye consumarism!

Good riddance

Cavehill Red

Ghost Estate wrote: »

We're already down and the US are shagged too, serves them right as it was the US who started giving those communists jobs in the first place.

Well, when the US start closing their FDI operations in Ireland, perhaps you mightn't be so gleeful at their troubles.

Ghost Estate

Cavehill Red wrote: »

Well, when the US start closing their FDI operations in Ireland, perhaps you mightn't be so gleeful at their troubles.

its only a matter of time now. if its anything they're good at here in the US its pretending everything is grand and brushing the bad under the carpet.

the recession should have been their wake up call but they are far too determined to continue on the old way and Obama is too much of a spineless git to do anything about it

orourkeda

Once they keep those chicken curries coming then it's all good.

CorkMan

jd007 wrote: »

Might as well get this out the way early...




The chinese, a great bunch of lads.

I, for one, welcome our new Chinese overmasters. I unconditionally praise Chairman Mao and welcome all of China for a couple of pints down Vaughans Pub.

Amhran Nua

Cavehill Red wrote: »

The issue is what happens when they start selling dollars to buy other currencies and precious metals, as they are now doing. That's a bigger deal than whether they continue buying US debt.

Seven whole percent of it.

Cavehill Red wrote: »

But there isn't one with China's capacity. India doesn't have the infrastructure or resources and neither does Brazil. Russia has the tech, but not the manpower or the low wages. Everywhere else, from Africa to Asia, isn't big enough.

You don't need one, there are dozens of them jockeying for China's slice of the pie. Add to which China's unfortunate unofficial stance on intellectual property and you have a recipe for another race to the bottom.

Cavehill Red wrote: »

Lacking backing by gold, silver or oil, the dollar too will collapse one day.

Would I be right in saying that you'd favour a gold backed currency?

Biggins wrote: »

I would sincerely, seriously suggest that your people, your party down tools what ever ye are doing and for full-time for months - not reading the occasional news items and/or European summarised report in a newspaper every so often, go and bone up on the current situation in regards to the Dollar.

...

Nope.
You really need to do your research.
It don't dwell for a new party to be so far off the mark in such a comment.

...

Well that comment alone shows a very deep, deep, misunderstanding of the current situation.
I would sincerely, seriously suggest that your people, your party down tools what ever ye are doing and for full-time for months - not reading the occasional news items and/or European summarised report in a newspaper every so often, go and bone up on the current situation in regards to the Dollar.

Your current totally misunderstand of the present situation does not inspire confidence in me to the extent yet that your organisation is a viable alternative to the current ones in terms of understand current economic overall knowledge and understanding of current financial relationships. Maybe in the future but at present, ye need to go back to school and do some learning and definitely some consistent research before speaking on such matters.

This country needs a party that understand economics in detail, not the occasional sound-bites that have been spun by those out with their own agenda!
(America trying to reassure its own and the European banking organisations, who are looking to shore up their own problems! Hell, they had to force our loans from them, down our necks - and let be honest, its really to save their European banking community, not the Irish economy as such for me and you.)

Yeah, if you could stick to the topic and stop leaving your lower lip hanging out over the stillbirth of your own political group, rather than making backhanded comments to people who are doing a lot more than posting on boards, that would be great.

The first article you quoted extensively was from Alternet, which is not an unbiased or even handed source of news, as they themselves say:

AlterNet’s aim is to inspire action and advocacy on the environment, human rights and civil liberties, social justice, media, health care issues, and more.

That particular article you quoted was called "4 Scenarios for the coming collapse of the American Empire". If they can't even get the political system of the US correct, what hope for the rest?

Biggins wrote: »

Further to the above post and to add credence to the analysis that China has already gain dominance over the USA , for example comes the following from 2005 alone (and since then things have got even worse):

We can talk about dominance when China has managed indoor plumbing for most of its citizens, and people coming to complain about it aren't shoved into black prisons. The situation is a bit more complex than a few quickly googled articles can reveal. The average standard of living in the US far exceeds that of China, and the Communist party knows that they need to keep the economy growing, or the consequences could be disastrous. Of course, they can't. Either they spread the welath and hence the power into more socialised services, which cost money, or they will inevitably face insurrection.

Biggins wrote: »

The general consensus is that between the trillions of loans - not billions - but trillions, China for all intensive effect owns America and in deed has already gained world dominance in all but name and by the back banking door!

Consensus among the wingnuts and goldbugs maybe. The simple fact is that seven percent (7%) is the total amount of debt owned by China. Seven percent is not ownership, and even if it was 100%, it still wouldn't be ownership.

Let me clarify things in simple terms: this has all happened before. The exact same process happened with Japan, step by step, where everyone in the US was terrified that they were going to buy up the entire United States, currency manipulation, top down direction of industry, right up to the penultimate property bubble that Japan still hasn't gotten over. And what's happening with China right now?

And you haven't dealt with the fact that the USD is still the de facto global currency, which has a lot more to do with currency reserves and trade volume than loans from China. Iraq setting up its oil bourse in euros is very commonly known, but Iraq is a US protectorate now. Iran hasn't even got the capacity to refine its own oil.

However, as the United States remained the world's preeminent economic superpower, most international transactions continued to be conducted with the United States dollar, and it has remained the de facto world currency.

Only two serious challengers to the status of the United States dollar as a world currency have arisen. During the 1980s, the Japanese yen became increasingly used as an international currency, but that usage diminished with the Japanese recession in the 1990s. More recently, the euro has increasingly competed with the United States dollar in international finance.

Since the mid-20th century, the de facto world currency has been the United States dollar. According to Robert Gilpin in Global Political Economy: Understanding the International Economic Order (2001): "Somewhere between 40 and 60 percent of international financial transactions are denominated in dollars. For decades the dollar has also been the world's principal reserve currency; in 1996, the dollar accounted for approximately two-thirds of the world's foreign exchange reserves" .

Many of the world's currencies are pegged against the dollar. Some countries, such as Ecuador, El Salvador, and Panama, have gone even further and eliminated their own currency in favor of the United States dollar. The dollar continues to dominate global currency reserves, with 63.9% held in dollars, as compared to 26.5% held in euros.

Back to school, eh?

Biggins wrote: »

P.S. I reserve the right to be wrong and not know what the hell I'm talking about!
I'm just an average Irish person.

I'd appreciate if you keep that in mind before you make free with the backhanded comments about people who really are trying to do some good.

drdeadlift

maybe with all these "bubbles" bursting the worlds economies might find a better way to operate,maybe more as a single unit not too sure if that would work.

All this debt i see between us-china/irl-imf/eu i cant see it being paid back before another world war.

fontanalis

Deleted User wrote: »

Bubbles all over the world! European ones - popped; US ones - popped; Chinese ones - overinflated!

Where next after this one pops, India?

Emerging Markets I say, or more commodities.
I recommend Jared Diamonds book Collapse, his chapter on China is very interesting. The growth look scompletely unsustainable.

Cavehill Red

Amhran Nua wrote: »

Seven whole percent of it.

You don't seem to understand the effect of junking an already devaluing currency by dumping it on the market.

Amhran Nua wrote: »

You don't need one, there are dozens of them jockeying for China's slice of the pie. Add to which China's unfortunate unofficial stance on intellectual property and you have a recipe for another race to the bottom.

There won't be a pie. No one has China's capacity. No one has China's resources. No one has China's liquidity. When China goes, and the consumers in the US and EU are so indebted as to be incapable of buying anyway, the global economy enters the equivalent of the Dark Ages.

Amhran Nua wrote: »

Would I be right in saying that you'd favour a gold backed currency?

I'd favour currencies backed by a basket of commodities. The dollar, since 1971, has effectively been backed by the world economy and specifically by the oil market. As the oil producers seek to trade in other currencies, what does that make the dollar? What is it now backed by? Effectively nothing other than Fort Knox, which hasn't been audited in a very long time, and the US military.
That's hardly a stable basis for a global reserve currency, and China, OPEC and Russia all realise that, which is why they're jettisoning it.
Worse, the upstart alternative, the euro, is unravelling at a frightening rate as the inbuilt flaw in the system - no convergence in tax or budgeting when the currency was converged - makes itself felt.

Cavehill Red

fontanalis wrote: »

Emerging Markets I say, or more commodities.
I recommend Jared Diamonds book Collapse, his chapter on China is very interesting. The growth look scompletely unsustainable.

Good book. China's growth has been in excess of 10% pa for three DECADES now. That's a whopper of a bubble, even if it was in a tiny country. However, it's in one of the world's largest countries. The collapse will be vast, likely bringing down an awful lot of other things in its wake.

There are other bubbles out there. Property in parts of Oz, some commodities, quite a few US equities, to name a few. But they're nothing to China.

ScumLord

It's good to hear China are having difficulties and aren't going to be able to own the world outright. But if any country can over come these kind of problems I'd say it would be China, they can get things done, partly because nobody has the right to stand in the way of what the government wants but just as much down to their own good thinking and hard work ethic.

Amhran Nua

fontanalis wrote: »

I recommend Jared Diamonds book Collapse, his chapter on China is very interesting. The growth look scompletely unsustainable.

Its is. They'll eventually stabilise at near par with the US, in all likelihood, but they have vast amounts of work to do in order to secure their society and economy; the road will be rocky, and will involve a realisation that a benevolent dictatorship is not an optimal form of government.

Cavehill Red wrote: »

You don't seem to understand the effect of junking an already devaluing currency by dumping it on the market.

I understand what 7% is, alright. You're talking about a severe shockwave if they try something like that, but not that severe, and it would hurt China a lot more than it would hurt the US, since their own currency manipulation would be damaged.

Cavehill Red wrote: »

There won't be a pie. No one has China's capacity. No one has China's resources. No one has China's liquidity. When China goes, and the consumers in the US and EU are so indebted as to be incapable of buying anyway, the global economy enters the equivalent of the Dark Ages.

Thats if you're thinking of a complete collapse of China, as in it falls off the face of the planet. I can't see that happening, or its unlikely anyway.

Cavehill Red wrote: »

I'd favour currencies backed by a basket of commodities.

The Chinese were pushing for something like that in the IMF as well, it might work, but don't expect the world's only superpower to row in behind it.

The status quo will not persist, it never does, but things will change slowly.

fontanalis

Amhran Nua wrote: »

Its is. They'll eventually stabilise at near par with the US, in all likelihood, but they have vast amounts of work to do in order to secure their society and economy; the road will be rocky, and will involve a realisation that a benevolent dictatorship is not an optimal form of government.


I understand what 7% is, alright. You're talking about a severe shockwave if they try something like that, but not that severe, and it would hurt China a lot more than it would hurt the US, since their own currency manipulation would be damaged.


Thats if you're thinking of a complete collapse of China, as in it falls off the face of the planet. I can't see that happening, or its unlikely anyway.


The Chinese were pushing for something like that in the IMF as well, it might work, but don't expect the world's only superpower to row in behind it.

The status quo will not persist, it never does, but things will change slowly.

I think China nose diving would have a big impact on the US, not Mad Max 2 type disaster but it will effect their capability to issue bonds won't it?