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Old 12-15-2009, 09:22 AM
 
Location: San Diego California
6,797 posts, read 6,121,963 times
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Foreign demand for long-term US assets slows - Yahoo! Finance

This article shows why the people who keep telling us the deficits do not matter and that China will continue to purchase treasuries are wrong. The reckless economic policies are now damaging the credibility of U.S. debt, and causing dollar devaluation worldwide.
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Old 12-15-2009, 11:36 AM
 
Location: Great State of Texas
86,093 posts, read 69,914,204 times
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China just became the #1 spot for IPO's.
China is in a financially good spot. Who would have thought a communist country would be on their way to also be so capitalistic ?
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Old 12-15-2009, 10:24 PM
 
Location: Conejo Valley, CA
12,476 posts, read 16,976,529 times
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Quote:
Originally Posted by jimhcom View Post
This article shows why the people who keep telling us the deficits do not matter and that China will continue to purchase treasuries are wrong. The reckless economic policies are now damaging the credibility of U.S. debt, and causing dollar devaluation worldwide.
Ugh, it shows no such thing. I guess you believe that foreigners (especially foreign nations) have been purchasing US debt because they want Americans to be able to afford new houses, cars, TVs etc. That must be it, because the reality puts this in a much different light.

The reduction in foreign US debt purchases has nothing to do with a loss of credibility, rather the fact that foreign nations trade surplus with the US is shrinking. You see, foreign US debt purchases are directly tied to the US trade deficits. Those deficits have reduced recently and as a result so have foreign debt purchases.

But what else? Oh yes...the only way other nations can further reduce their US debt purchases is by further reducing the US trade deficit. But wait!? That means exports will increase and imports will shrink therefore stimulating the US economy.

No doom and gloom here.
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Old 12-16-2009, 03:26 AM
 
12,870 posts, read 12,776,833 times
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unfortunately for that theory our trade deficit would be improving, but it isn't:
FTD - Statistics - Country Data - U.S. Trade Balance with China

we are importing more.
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Old 12-16-2009, 07:28 AM
 
Location: San Diego California
6,797 posts, read 6,121,963 times
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Quote:
Originally Posted by user_id View Post
Ugh, it shows no such thing. I guess you believe that foreigners (especially foreign nations) have been purchasing US debt because they want Americans to be able to afford new houses, cars, TVs etc. That must be it, because the reality puts this in a much different light.

The reduction in foreign US debt purchases has nothing to do with a loss of credibility, rather the fact that foreign nations trade surplus with the US is shrinking. You see, foreign US debt purchases are directly tied to the US trade deficits. Those deficits have reduced recently and as a result so have foreign debt purchases.

But what else? Oh yes...the only way other nations can further reduce their US debt purchases is by further reducing the US trade deficit. But wait!? That means exports will increase and imports will shrink therefore stimulating the US economy.

No doom and gloom here.
If this were true the ratio of debt purchaces should be equal to the reduction in trade surplus. This is not the case. What Now?
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Old 12-18-2009, 02:42 PM
 
12,870 posts, read 12,776,833 times
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Quote:
Originally Posted by mikeharnen View Post
They're not capitalist, they just know how to make communism work. And we figured out how to screw capitalism up.


Them being successful, doesn't mean they're capitalist. They just beat us at our own game.
we did not screw capitalism up. the government refused to regulate wall street and thus greed overtook the wall street players, since they had HUGE leverage ratios to work with. the bets did not pay off and then our government CHOSE to bail them out, which has nothing to do with capitalism.

don't think that the chinese are going to have a hard road ahead with their massive overbuilding, coupled with decreased demand, and the flooding of government stimulus money. that is exactly how bubbles are created!
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Old 12-19-2009, 07:20 AM
 
Location: 3rd Rock fts
745 posts, read 941,184 times
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Quote:
Originally Posted by floridasandy View Post
we did not screw capitalism up. the government refused to regulate wall street and thus greed overtook the wall street players, since they had HUGE leverage ratios to work with. the bets did not pay off and then our government CHOSE to bail them out, which has nothing to do with capitalism.

don't think that the chinese are going to have a hard road ahead with their massive overbuilding, coupled with decreased demand, and the flooding of government stimulus money. that is exactly how bubbles are created!
This is all true but it’s still the people’s fault. The people made Wall Street/Big Business powerful by contributing to their 401k’s. Also the people let the low interest rates continue & material wants increase in price. Here is a simplified example of what I mean:

• A person can’t afford a home.
• The financial system says no problem, will lend you some money cheap & no money down. Don’t worry about the future because your 401k & house will appreciate forever!

Guess what happens if the person said, I don’t want the loan because it just doesn’t seem feasible in my mind. You guessed it; the price of the house goes down—Capitalism @ work (supply & demand). You can do this with TV’s, cars, etc… The people are letting Capitalism be destroyed!

The Chinese have an opportunity to do Capitalism right; there's plenty of savers to fill the greed gaps.
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Old 12-19-2009, 09:26 PM
 
Location: Conejo Valley, CA
12,476 posts, read 16,976,529 times
Reputation: 4304
Quote:
Originally Posted by floridasandy View Post
unfortunately for that theory our trade deficit would be improving, but it isn't:
FTD - Statistics - Country Data - U.S. Trade Balance with China

we are importing more.
You don't determine the trade deficit by looking at trade between only two countries. The trade deficit has improved a lot this year.

Unfortunately you only seem to have interest in distorting information.
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Old 12-20-2009, 04:30 AM
 
12,870 posts, read 12,776,833 times
Reputation: 4446
Quote:
Originally Posted by DSOs View Post
This is all true but it’s still the people’s fault. The people made Wall Street/Big Business powerful by contributing to their 401k’s. Also the people let the low interest rates continue & material wants increase in price. Here is a simplified example of what I mean:

• A person can’t afford a home.
• The financial system says no problem, will lend you some money cheap & no money down. Don’t worry about the future because your 401k & house will appreciate forever!

Guess what happens if the person said, I don’t want the loan because it just doesn’t seem feasible in my mind. You guessed it; the price of the house goes down—Capitalism @ work (supply & demand). You can do this with TV’s, cars, etc… The people are letting Capitalism be destroyed!

The Chinese have an opportunity to do Capitalism right; there's plenty of savers to fill the greed gaps.
i agree with a lot of your post. the government made wall street attractive to people by providing them with a "tax benefit". i do believe that the MSM is contributing to this "don't be the last person in on the deal" mentality that we are currently seeing. if people would step back and look at the entire economic picture, they wouldn't be rushing headlong into an overpriced market or overpriced homes.

the chinese probably aren't going to do it right either because their government can force bubbles by direct massive spending. they have been on a massive spending spree, but world demand is down. don't you find it ironic that china is counting on the US consumers to start spending, and US investors think that china's growth is going to save the world economy. in the meantime, countries are facing increasingly difficult economic pressures.
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Old 12-20-2009, 06:23 AM
 
4,010 posts, read 8,709,887 times
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I recommend that people go read up on Capitalism then try to think if it applies to the US economy. It doesn't. If we had true capitalism we would not need a Federal Reserve which intervenes in the market to adjust the value of money to stimulate or depress segments of the economy. We would not be bailing out businesses, we would not have environmental, health, safety, etc etc regulations.

On the other side of the coin the Communists in China are using unfettered Capitalism at it's finest to exploit it's people, often in slave like conditions because they have no constitutional rights, to make money for the communists and their western partners. It's my guess that no American would find this capitalist environment acceptable at all. The cries of socialist reforms would happen and then you have the risk of a tank being rolled over you.
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