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Old 03-27-2012, 12:36 PM
 
Location: Pennsylvania
3,780 posts, read 5,498,176 times
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Well put, cpg. Of course, since it doesn't fit into a 15 second sound bite, the majority of people won't take the time to digest it and will continue to fear this latest bogeyman.
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Old 03-27-2012, 12:51 PM
 
24,775 posts, read 26,159,449 times
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Originally Posted by maf763 View Post
Well put, cpg. Of course, since it doesn't fit into a 15 second sound bite, the majority of people won't take the time to digest it and will continue to fear this latest bogeyman.
And one other thing. Given the long-term structural problems of the Chinese economy, what current would take the place of the dollar? I'm not being triumphalist or arrogant at all, for the dollar does indeed have its problems. But the Yuan is going to suffer in the coming years. The Euro? The Yen? Anybody have any kind of idea?
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Old 03-27-2012, 01:45 PM
 
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I think either the Renminbi or a basket of commodities would be the most likely replacement.
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Old 03-27-2012, 07:36 PM
 
Location: Pennsylvania
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We could try Dutch tulips, a la 1637.
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Old 04-11-2012, 04:30 AM
 
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Quote:
Originally Posted by cpg35223 View Post
First, the Chinese are running into major, major structural problems of their own, ones that make any financial problems the U.S. has look like a minor hiccup in comparison....

Let's begin with the massive glut of real estate in China at the moment. At the height of the U.S. real estate bubble, there was an oversupply of 14 months of real estate inventory. In major cities such as Shanghai and Beijing, the oversupply ranges from 8 to 11 years. And when you realize that construction is roughly 50% of the Chinese GDP, that's about as disquieting as it gets. In short, they need to stop building but they can't stop building...
And this is not the only artificial construct the Chinese are pursuing to maintain employment. Look at aluminum and other commodities which they are producing at record pace despite a dearth of demand. This is simply to keep the populace employed and is utterly unsustainable.

Myths, rumors and paranoia have been propagating about China for decades.
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Old 09-21-2012, 04:10 PM
 
880 posts, read 405,045 times
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US Dollar "Petro Dollar" is no longer primary oil currency. Now China's Yuan is "Petro Yuan"

Got Gold???????????

"On Thursday, Sept. 6... just a few days ago, China made the official announcement. China said on that day, our banking system is ready, all of our communication systems are ready, all of the transfer systems are ready, and as of that day, Thursday, Sept. 6, any nation in the world that wishes from this point on, to buy, sell, or trade crude oil, can do using the Chinese currency, not the American dollar...

Ironically, since Sept. 6, the U.S. dollar has fallen from 81.467 on the index to today's price of 79.73. While analysts will focus on actions taking place in the Eurozone, and expected easing signals from the Federal Reserve on Thursday regarding the fall of the dollar, it is not coincidence that the dollar began to lose strength on the very day of China's announcement...

On Friday, Sept. 7, Russia announced, that as of today, we will supply China with all of the crude oil that they need, no matter how much they want... there is no limit. And Russia will not sell or trade this crude oil to China using the American dollar."
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Old 09-22-2012, 07:00 AM
 
Location: Maine
641 posts, read 445,663 times
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Originally Posted by cpg35223 View Post
First, the Chinese are running into major, major structural problems of their own, ones that make any financial problems the U.S. has look like a minor hiccup in comparison. Take any and all issues you have with the value of the dollar and use a similar criterion for the yuan, and you have big problems. The amount of public moneys spent on large public service projects without any conceivable return, the wholesale cooking of the books, and the enormous demographic challenges looming ahead all are in place to create wholesale economic disasters that are far more worrisome than a repeat of Japan in 1989. Add to that the fact that the United States now gets roughly 85% of its petroleum from North America and our dependence on Saudi oil just isn't that high.

Back to China. Let's begin with the massive glut of real estate in China at the moment. At the height of the U.S. real estate bubble, there was an oversupply of 14 months of real estate inventory. In major cities such as Shanghai and Beijing, the oversupply ranges from 8 to 11 years. And when you realize that construction is roughly 50% of the Chinese GDP, that's about as disquieting as it gets. In short, they need to stop building but they can't stop building. This won't end well.

Second, at this very moment in history, China has as many people of working age as it ever will. Think about that. According to the United Nations, China is facing a very large drop-off in its number of workers due to the extremely rapid aging of its population, beginning in the year 2014. By the end of the 21st Century, the same study shows that the United States will almost have as many workers as China. That signals an enormous diversion of national resources into taking care of the old and sick, particularly since China has no mature pension system and virtually non-existent retirement savings. When you realize that, besides construction, the Chinese economy hinges on cheap labor as its main bargaining chip, that spells big, big trouble. What's more, roughly 95% of every tech product China makes is simply the assembly of parts made elsewhere. That's it. So if wages rise due to a smaller pool of labor, then tech companies simply pick up and move their factories elsewhere. India. Indonesia. Brazil. South Africa. Anywhere the labor is relatively cheap. And that spells trouble, because China is not technologically mature enough to compete on the international stage. It has gotten to this point through sheer brute force and economies of scale, not finesse or technical prowess.

The upshot? China is having a good run of it, but a great deal of their current success is based on the contradictions that have been built into a rigged and artificial system. I would be very cautious before thinking that we'll see a permanent geopolitical shift across the Pacific. The long-term numbers are simply not there.
All this has to make you wonder what the chinese gov. will do when the SHTF will they attempt to deal with there internal social problems? Or will they distract the masses with a convient war.
I don't think they would outright attack the U.S. but an attack on Tiawan or Japanese areas of control could draw us into a large conflict, assuming the American public is not burned out on our young men and women being killed overseas.
On the other hand wars do create lots of jobs, and if our economy tanks our own Gov. may look at a war as a good distraction for our own problems.


bill
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