but, even just this single statement: There are no real negative long term consequences to China owning American debt, in fact, it is probably better for both nations in the long run.
read all that I have posted if you want the proofs, but that is the main, bumper sticker-esque point.
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Looking at you.
I don't have a problem. However, your approach comes across as argent. Why would you not go back and read what someone is talking about, and then ask the person what did they say? Make an effort, dude.
The debt that we owe to China is very relevant, because China is not going to sit back and take a loss. Who would?! We have to pay this money back, but we do not have the capital to do so - other than printing money via the FED. This creates inflation, and the value of our dollar suffers - less purchasing power. The point is, our currency is becoming toxic and undervalued, and China will halt the lending of their money to us. No profit for China - only wasted investments. This guarantees the printing of more money to cover our debts, not to mention tax hikes for Americans (since our government has zero ability to pay it back). We are literally witnessing the collapse of our economic system, thanks to our own very government. This has been going on for decades, but our past is catching up to us.
America is the number one debtor nation in the world! Other countries can absorb a major economic hit, because their money is not inflated to the degree that of US currency. Plus, they have savings; the US has zip! The United States is completely swamped in debt, whereas other countries are not. America literally has to borrow money just to keep government alive. Yes, international monies are entangled, but since Washington is way over their head in debt (with an inflated currency), expect things to change over the next 5 to 10 years. It's already happening. Governments internationally aren't as stupid as Washington.
If China is able to sell our debt - which it won't - the debt still remains! I doesn't just vanish into thin air because it is sold for profit. The buck is merely passed to someone else. We're still going to further inflate our currency to pay back the debt owned (regardless of who owns it). It's true, no one wants to the US currency to crash, but Washington is completely out of control, and it is forced the international community to take precautions! If government spending does not stop, eventually, international communities like China will stop lending us their money. None of this is complicated. It's all very basic. If I missed any thing I should have touched on, let me know.
Last edited by ushomefree on Apr 7th, 2010 at 08:59 PM
well, I'll do a better response, but you missed the fact that, short of all out war, China can't collect, that China IS, as in today, trying to sell the debt, and that, even if America borrowed for 1000 years, it would still be in China's best interest to support them... If America has no money, who will buy Chinese goods?
I'm supposed to be writing a paper, so I will have to do a better one later
EDIT: we do agree on unchecked spending. Obviously America has to work on its deficit (different than debt), which will help its economy, however, I would argue that there are better places they could cut than by eliminating a social net. Such social policy is beneficial to the economy in different ways, though not necessarily immediatly in macroeconomic terms, though clearly in microeconomics. The obvious notion is to reduce military spending through joint co-operation between the major world powers, but even then, targeting government corruption and waste would be a great first step.
__________________ yes, a million times yes
Last edited by tsilamini on Apr 7th, 2010 at 09:07 PM
Your missing the fundamental point. If the US dollars collapses via inflation, no one in their right mind would do business with us, nor would they want to. Our currency will be equivalent to toilet paper. In Germany, when their dollar crashed, citizens used to burn it to heat their houses, ha ha! It was cheaper than fire-wood. What our government is doing is nothing new; it has been tried before, and it always leads to currency collapse. It's basic mathematics. So... forget about China doing business with us (in the long run). It just ain't gonna happen.
Brother... I'm with you, but our debt could be stacked along side mountains. Government spending across the board needs to stop - to live within our means. Of course, this will never happen. Washington will spend money until we're pushed off the cliff; then they'll act, ha ha! Too late! Elected officials pretend that everything is hunky-dory to win votes (while promising the world to the American population). Politicians love votes, and they sell their souls and lie for them everyday. They even do it to avoid criticism. When things go bad, they blame it on Capitalism - never mind corruption, bailouts, cronyism, corporatism and misinformation! And never mind the idiotic policies that they mandate. It always someone else's fault. Politicians are con-men, and Americans need to wake up. And I totally mean that in a constructive way.
Great Britain, Japan, Canada, Ireland, Italy, Greece, France, Germany, Norway, Poland, UAE, Switzerland, Sweden. Just to name the first world countries with debt worse than the United States.
Unless, of course, you wish to claim that the economy of all of those countries has been totally destroyed. Honestly, I think we would have noticed.
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In 2009 they had one of the ten highest debts in the world. Given that it's now 2010 and I'm going to Greece this summer I'd say the country didn't have it's whole economy implode enough to destroy them.
__________________
Graffiti outside Latin class.
Sed quis custodiet ipsos custodes?
A juvenal prank.
Symmetric Chaos... the US is the number one debtor nation on the face of the planet. No country (that hasn't fallen already) can't even begin to touch us. What are you talking about?
Last edited by ushomefree on Apr 7th, 2010 at 10:34 PM
A man with $1000000 has $1000 in debt. This is okay for him.
Another man has $10 and has $100 in debt. This is bad.
You've taken the naieve approach of saying that the first man has the worse debt because of its higher absolute value. That's stupid, the other man has less absolute debt but it is a much greater problem for him.
While you can claim without substantiation that the US has no economy any more (do you live in a hole in the ground watching nothing Ron Paul on Youtube or something?) this is factually untrue. The size of the American GDP shows that in fact numerically huge US debt is proportionally smaller than that of all those nations I listed.
__________________
Graffiti outside Latin class.
Sed quis custodiet ipsos custodes?
A juvenal prank.
well, in the same way that the Canadian economy is stronger than the Americans, only worth much less, countries can have a greater debt-to-income ratio and still have less overall debt than America
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Apr 7th, 2010 07:28 PM
