Egads!
Dec 25th, 2004, 07:36 AM
#21
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>We are NOT any longer the engine that drives the world's economy. Debtors don't drive much for long. <
I beg to differ. According to the World Bank report dated Sept, 2004, In 2003 US GDP was $10.7 trillion. The Entire World GDP was $36.4 trillion. Number 2 was Japan at $4.3 trillion.
http://www.worldbank.org/data/databytopic/GDP.pdf
>It is a basic question of how long will nations like Japan and China fund American debt? <
As long as they have to in order to sell goods/services to the US
>When and where was the last time you heard talk of foreign central banks taking action to bolster a declining dollar?<
During the 1980's when the US National debt more than doubled, a square mile of real estate in Japan was worth more than all of the equity on the New York Stock Exchange, and the Japanese were telling us how we ought to learn their business methods.
From 1986 to 1989 the $ lost 40% against the Yen. From 1990 to 2004 it lost only 30%.
This probably explains why the Japanese economy has verged on depression for more than a decade, while the US economy has been expanding.
> What does the US have to sell? We are a service based economy selling other nations' exports except for paper products and food stuffs. <
A 12 TRILLION dollar Chinese laundry economy?
>Let's put it this way: How many Chevrolets and Fords of American manufacture do you see on the streets of Europe? ...... Why? Nobody wants them! <
Pish tosh. In 2003, Ford sold 1.6 million cars in Europe (http://makeashorterlink.com/?I2D112A1A), while GM sold about 1.7 million
This is over 20% of all cars sold in Europe that year.
Could it be that, in addition to trade barriers and shipping costs, cars built for the US market are just not suited to the European and Japanese markets?
>Name me one American manufactured item that sits popularly on the shelves in European and Asian stores. <
Computers running Microsoft DOS on Intel chips.
>Go into an American store, and start counting the different items with the label "Made in China."<
You are about 30 years late with this example. How about steel, shoes, heavy equipment, automobiles, textiles, ships......
>Now for the next step. I keep asking questions like this: What happens when foreigners don't want dollar securities?<
At the current time, this is a very unlikely event. The EU politicians are currently talking about intervening to keep the Euro from rising. (http://www.theallineed.com/news/0412/064735.htm) The French and Germans are especially concerned because their budget shortfalls exceed EU guidelines.
>We are in debt up to our ear lobes to the tune of nearly $8 trillion.
The US national debt, as a percent of GDP, is lower than it was under Pres. Reagan. As I have noted earlier, it is less than that for Japan, France, Germany and Italy.
I beg to differ. According to the World Bank report dated Sept, 2004, In 2003 US GDP was $10.7 trillion. The Entire World GDP was $36.4 trillion. Number 2 was Japan at $4.3 trillion.
http://www.worldbank.org/data/databytopic/GDP.pdf
>It is a basic question of how long will nations like Japan and China fund American debt? <
As long as they have to in order to sell goods/services to the US
>When and where was the last time you heard talk of foreign central banks taking action to bolster a declining dollar?<
During the 1980's when the US National debt more than doubled, a square mile of real estate in Japan was worth more than all of the equity on the New York Stock Exchange, and the Japanese were telling us how we ought to learn their business methods.
From 1986 to 1989 the $ lost 40% against the Yen. From 1990 to 2004 it lost only 30%.
This probably explains why the Japanese economy has verged on depression for more than a decade, while the US economy has been expanding.
> What does the US have to sell? We are a service based economy selling other nations' exports except for paper products and food stuffs. <
A 12 TRILLION dollar Chinese laundry economy?
>Let's put it this way: How many Chevrolets and Fords of American manufacture do you see on the streets of Europe? ...... Why? Nobody wants them! <
Pish tosh. In 2003, Ford sold 1.6 million cars in Europe (http://makeashorterlink.com/?I2D112A1A), while GM sold about 1.7 million
This is over 20% of all cars sold in Europe that year.
Could it be that, in addition to trade barriers and shipping costs, cars built for the US market are just not suited to the European and Japanese markets?
>Name me one American manufactured item that sits popularly on the shelves in European and Asian stores. <
Computers running Microsoft DOS on Intel chips.
>Go into an American store, and start counting the different items with the label "Made in China."<
You are about 30 years late with this example. How about steel, shoes, heavy equipment, automobiles, textiles, ships......
>Now for the next step. I keep asking questions like this: What happens when foreigners don't want dollar securities?<
At the current time, this is a very unlikely event. The EU politicians are currently talking about intervening to keep the Euro from rising. (http://www.theallineed.com/news/0412/064735.htm) The French and Germans are especially concerned because their budget shortfalls exceed EU guidelines.
>We are in debt up to our ear lobes to the tune of nearly $8 trillion.
The US national debt, as a percent of GDP, is lower than it was under Pres. Reagan. As I have noted earlier, it is less than that for Japan, France, Germany and Italy.
Dec 25th, 2004, 11:24 AM
#26
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This is really interesting and a topic I've been anxious to see discussed somewhere. I recently heard through the grapevine that a woman who works for the Fed said the only thing propping up the dollar was our foreign bond holders and that if they sold off we were in big trouble.
Just this morning another friend headquartered in England told me that Castro is dumping dollars and encouraging his people to get their U.S. families to send Euros instead. Tiny blip, but a worrying one.
Just this morning another friend headquartered in England told me that Castro is dumping dollars and encouraging his people to get their U.S. families to send Euros instead. Tiny blip, but a worrying one.
Dec 25th, 2004, 01:40 PM
#27
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>Castro is dumping dollars and encouraging his people to get their U.S. families to send Euros instead.<
That's interesting.
I'm supposed to take a 15% hit to buy euro in the US, so that Castro & Co don't have to convert dollars to pesos to euros.
>...a woman who works for the Fed said the only thing propping up the dollar was our foreign bond holders...<
Of course, the only thing propping up our foreign bond holders is the US dollar.
It is conceivable that everyone in the whole world holding dollars would suddenly decide to buy zloty.
That is about as likely as Maxwell's Demon causing all of the Oxygen in the atmosphere to move to the North Pole.
That's interesting.
I'm supposed to take a 15% hit to buy euro in the US, so that Castro & Co don't have to convert dollars to pesos to euros.
>...a woman who works for the Fed said the only thing propping up the dollar was our foreign bond holders...<
Of course, the only thing propping up our foreign bond holders is the US dollar.
It is conceivable that everyone in the whole world holding dollars would suddenly decide to buy zloty.
That is about as likely as Maxwell's Demon causing all of the Oxygen in the atmosphere to move to the North Pole.
Dec 25th, 2004, 07:16 PM
#28
Join Date: Jul 2004
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IT WAS AUGUST 1971: My wife and I were stationed in Germany in the Army. We took leave to go to England. We camped in Belgium before taking the ferry across. We were on a tight budget....very tight.All we had was cash.
As we slept in Belgium, Richard Nixon devalued the dollar. The dollars in our pocket declined in value by about 20% as we slept. August 14...check it out. We found that out when we pulled into London the next day. Tourists we lined up at AmExp to cash in travelers checks.
RESULT? We had a fantastic time in London! Saw the plays and enjoyed the area. Saw the original HAIR.
We have since been back to Europe 25+ times....sometimes the dollar is up, sometimes it is down. If you wait for the perfect time....you will never go. Sorta like buying real estate. Just go and enjoy the trip. It is stupid to worry about what you have no control over. Go for it!
As we slept in Belgium, Richard Nixon devalued the dollar. The dollars in our pocket declined in value by about 20% as we slept. August 14...check it out. We found that out when we pulled into London the next day. Tourists we lined up at AmExp to cash in travelers checks.
RESULT? We had a fantastic time in London! Saw the plays and enjoyed the area. Saw the original HAIR.
We have since been back to Europe 25+ times....sometimes the dollar is up, sometimes it is down. If you wait for the perfect time....you will never go. Sorta like buying real estate. Just go and enjoy the trip. It is stupid to worry about what you have no control over. Go for it!
