And it may start, with China, at the upcoming G20 conference in South Korea:
China tees up G20 showdown with USBy Alan Beattie in Washington, Geoff Dyer in Beijing, Chris Giles in LondonPublished: November 5 2010 06:56 | Last updated: November 5 2010 19:03China has curtly dismissed a US proposal to address global economic imbalances, setting the stage for a potential showdown at next week’s G20 meeting in Seoul.Cui Tiankai, a deputy foreign minister and one of China’s lead negotiators at the G20, said on Friday that the US plan for limiting current account surpluses and deficits to 4 per cent of gross domestic product harked back “to the days of planned economies”.“We believe a discussion about a current account target misses the whole point,” he added, in the first official comment by a senior Chinese official on the subject. “If you look at the global economy, there are many issues that merit more attention – for example, the question of quantitative easing.”
“Quantitative easing.”
Ladies and gentlemen, that’s code for “printing money.”
And yes, with no backing.
Not a smart move; instead, the move of a fiscal dolt.
Gird thy loins, people.
BZ
P.S.
With regard to China, check this out.
China actually started following our lead for how to deal with real estate… save they did it with industrial, commercial and residential properties and bankrolled crony capitalists who have gone out of business so frequently it makes the eyes swim. Individuals are worked to death in China, not just factory workers but managers, as well, all for a tiny wage that can barely keep an apartment paid for.
Their bonds have been rolled over twice and this is the year that they actually had to face investors wanting their promised cash from them… which is why they started selling their Treasuries earlier this year. If they US goes through a major problem, which we are, China has this to a power I don’t want to think about. They are in the ever so nasty position of not buying debt then plunging the dollar into chaos and their own investments into dust, and their being unable to pay back their investors as they have no liquidity left in their economy.
This is not a liquidity problem, that of cash on hand to spend, but a solvency problem of too much tied up in bad debt, incredibly expensive infrastructure and paying non-productive parts of the workforce to either be in government jobs or to do nothing or, in the case of China, go hungry.
Europe and Russia have simimlar problems, just a bit further along the curve of them.
What happens when the US agricultural sector becomes to expensive to buy from overseas? We do feed much of the poor in Africa, Asia and elsewhere with good farming techniques that require a huge infrastructure for it which no one else, on this planet, has. This would be bad for the US, yes, but overseas? And China has been aging its agricultural sector out via the one child policy and industrial policy… what is coming is very bad news unless we STOP THE SPENDING and SHED GOVERNMENT en mass. We need to become solvent, first, so we can think about liquidity, second. The other way around got us into this mess of ready spending. That must now end.
“what is coming is very bad news unless we STOP THE SPENDING and SHED GOVERNMENT en mass. We need to become solvent, first, so we can think about liquidity, second. The other way around got us into this mess of ready spending. That must now end.”
In one word: YES.
BZ
How do you *gird your loins* against the most inept, corrupt and out of control POTUS in U.S. history?
No investment is safe, NONE…
TF, with the exception of the two MOST precious of metals. . .
BZ
And their concomitant tools. . .
BZ
Really TF, Bush was not corrupt by destroying the economy with a war that wasn’t even in the budget? Gimme a break.
CNN’s Fareed Zakaria sat down with economists Paul Krugman and Raghuram Rajan, and both men painted a very gloomy picture (to say the least) for what kind of shape the United States economy is going to be in if all we have is gridlock for the next two years, which Krugman believes is inevitable.
Krugman also thinks that we’ll be facing at least one government shutdown in the next two years. And of course as Eric Cantor already said today, if that happens the Republicans will try to make political hay out of it and put the blame on President Obama.
Brass
Lead
Steel
BZ, take the trash out man, the place has a smelly troll infestation…
This is not going to be pretty, regardless of which way it goes… sigh…
DB, I’ll answer you this time instead of deleting you because you didn’t make personal attacks or utilize four-letter words.
And please direct your replies to me and not my commenters.
In response, I submit that the BEST we can do at this point IS some sort of gridlock. That will, at the very least, keep us from spending even MORE dollars that we simply don’t possess.
One thing that has truly confused me about you and similar Leftists:
You profess to dislike banks. You dislike corporations and Capitalism.
Why, then, did you support Obama and his minions when he decided to extend “stimulus” to those very same banks, huge corporations, and massive financial institutions?
Myself and various other Conservatives wrote that this was completely UNnecessary money thrown after bad money.
THOSE corporations deemed “too big to fail” SHOULD have been ALLOWED to fail. And that includes not simply incorporated entities but any number of financial institutions as well.
HAD they failed, we would likely have been on an ACTUAL road to recovery at roughly this point following their multiple collapses.
And yet the Leftists supported even MORE cash they DIDN’T possess to buttress those very icons they professed to despise mightily.
I don’t “get” that at all. It is a MASSIVE philosophical conflict.
BZ
Suddenly the “Preppers” don’t seem as Kooky.
The question isn’t whether pain is coming. The question is who will get the most pain. So far, those who created the mess aren’t the ones catching.
WSF:
Funny you should mention that aspect. Those who managed to get in “over their heads” in terms of mortgages are the first to be bailed.
Those persons who stuck it out, tried as best they could to make their monthlies, tried for years, are finding they are the first “cast to the curb.”
It seems — IMAGINE THAT — “playing by the rules” isn’t considered.
People: because the money IS what it IS — you must DO what you MUST and then WHEN you must.
And so THANK YOU, fucking Leftists, for GUARanteeing our entire mortgage industry would tank and THEREFORE it would AFFECT the REST of the planet.
BZ
And the GOP will get the blame for the implosion.
I can only hope that the American electorate have better sense that to blame the GOP exclusively.
I bought the largest bag of pre-1965 dimes (90% Silver)
I could afford a little over a year ago.
Price then: $16.60/oz.
I just checked the price of silver on the spot market: $28.24/oz. By my way of reckoning that’s an almost 50% gain in value in just over a year. What’s scary, obviously, is that increase is not a true increase in value, but an indication of the decrease in the value of the dollar. The price of oil and other relatively non-elastic commodities will rise commensurately… and soon!
It’s not too late to get aboard this roller coaster folks…
But “too late” is coming soon.
I’m proud to call myself a “Prepper”.
Preppers are more likely to survive the coming chaos.
A year or so of food stored? Check.
A few thousand rounds of ammo per gun? Check.
As much medication as can be stored and won’t go bad? Check.
Cheap clothing from Sportsman’s Guide? Check.
4-person/4-season tent seam and floor sealed? Check.
Its not just me, but the neighborhood seems to have gotten the clue… I started about, what… 3 years ago? Now its just a question of time, and with the Fed printing money time is now running out. I can keep my spending down to the bare necessities to see what happens next.