China to 'liquidate' US Treasuries, not dollars.

[William Gaatjes]

Honda from Japan had an interesting perspective for a company.
Manufacture the product at the location you are going to sell it.
For example what is sold in the US, build in the US. What is sold in the EU, build in the EU. What is sold in China, build in china. And i mean every single part of the product.

Honda realized, they where not able to continue manufacturing in the EU because some parts had to come from Japan since the earthquake and the tsunami. And some of those manufacturing companies had not been able to provide the necessary parts. Thus they are deciding to use parts from local manufacturers. That would be great if all manufacturers did this. Less global logistics to worry about. And good for the local markets and jobs. Of course, this would mean a small rise in price (parts cannot be bought by the millions anymore but only by the thousands depending on the market and the location on earth) Redundant production from a different perspective. Instead of over producing to start price wars which inevitably will kill quality, innovation and reliability, produce what is needed when looking at a realistic future expectation of the market.
Of course, products will be a bit more expensive, but hey do you really think that for example a 7 dollar blue ray player can deliver any quality ?

 

[Jhhnn]

they live in hell.

They live in the Chinese version of the Gilded Age of America, 120 years ago. Senseamp's first pic could have been of Pittsburgh or any number of American cities of the era.

Listen to your Republican friends- they'll put us all in the wayback machine so we can live that Libertopian dream all over again.

 

[momeNt]

They live in the Chinese version of the Gilded Age of America, 120 years ago. Senseamp's first pic could have been of Pittsburgh or any number of American cities of the era.

Listen to your Republican friends- they'll put us all in the wayback machine so we can live that Libertopian dream all over again.

Do any of your posts ever contain any substance or are they all just full of rhetorical crap? No reason to try and turn every thread into an attack on views that you don't hold.

On a different note, hopefully China does liquidate treasuries and helps devalue our dollar. We've been exporting away our middle class jobs and growing foreign nations holding of treasuries for way too long. When these nations turn their USD into treasuries, it effectively keeps our wages artificially propped up internationally and continues to allow the exporting nations to continue sending USA goods more competitive than what we can provide them at. If China was to turn their debt holdings into USD and stop accepting treasuries to settle trade imbalances it would strengthen their currency against ours and bring back jobs to the USA.

 

[JSt0rm]

Do any of your posts ever contain any substance or are they all just full of rhetorical crap? No reason to try and turn every thread into an attack on views that you don't hold.

Shut up.

 

[Jhhnn]

Do any of your posts ever contain any substance or are they all just full of rhetorical crap? No reason to try and turn every thread into an attack on views that you don't hold.

On a different note, hopefully China does liquidate treasuries and helps devalue our dollar. We've been exporting away our middle class jobs and growing foreign nations holding of treasuries for way too long. When these nations turn their USD into treasuries, it effectively keeps our wages artificially propped up internationally and continues to allow the exporting nations to continue sending USA goods more competitive than what we can provide them at. If China was to turn their debt holdings into USD and stop accepting treasuries to settle trade imbalances it would strengthen their currency against ours and bring back jobs to the USA.

Awww... musta hit a nerve. good. One wahmbulance, coming right up.

China wants to do what any smart big time investor wants to do- diversify their holdings so that losses in any sector or country are offset by gains in another.

And, uhh, in case you haven't realized it, China's industrial might has been built with American capital. Thanks, Job Creators!

 

[halik]

Who's got the chart of china gdp vs USDCNY

 

[gevorg]

China is a bubble with controlled commie GDP data.

 

[the DRIZZLE]

Do any of your posts ever contain any substance or are they all just full of rhetorical crap? No reason to try and turn every thread into an attack on views that you don't hold.

On a different note, hopefully China does liquidate treasuries and helps devalue our dollar. We've been exporting away our middle class jobs and growing foreign nations holding of treasuries for way too long. When these nations turn their USD into treasuries, it effectively keeps our wages artificially propped up internationally and continues to allow the exporting nations to continue sending USA goods more competitive than what we can provide them at. If China was to turn their debt holdings into USD and stop accepting treasuries to settle trade imbalances it would strengthen their currency against ours and bring back jobs to the USA.

China can move out of longer term US bonds without letting their currency strengthen. They can just buy shorter term debt or physical assets.

 

[momeNt]

China can move out of longer term US bonds without letting their currency strengthen. They can just buy shorter term debt or physical assets.

Strengthen in relation to USD, it may not strengthen to other currencies but we are talking about USD here. Really it's USD weaking against all currencies is what would happen.

 

[momeNt]

Awww... musta hit a nerve. good. One wahmbulance, coming right up.

China wants to do what any smart big time investor wants to do- diversify their holdings so that losses in any sector or country are offset by gains in another.

And, uhh, in case you haven't realized it, China's industrial might has been built with American capital. Thanks, Job Creators!

China's industrial might has been created with American capital, provided to them by monetary policy by the federal reserve that did not allow our dollar to reflect our dwindling productive capacity as a nation. We then decided to bitch and moan about China's currency not reflecting their increased productive capacity, only reason Geithner is complaining is he must think only the USA can mess around with its currency, everybody else has to play by the rules....

So don't thank the job creators, thank the federal reserve and policy makers for selling the middle class to China.

 

[Macamus Prime]

?

And to think - all of this could have been OURS, if that GAWD DAMNED GUBNAMENT didn't intarfere wit us bidness men!!!!

 

[the DRIZZLE]

Strengthen in relation to USD, it may not strengthen to other currencies but we are talking about USD here. Really it's USD weaking against all currencies is what would happen.

My point still holds.

 

[Jhhnn]

China's industrial might has been created with American capital, provided to them by monetary policy by the federal reserve that did not allow our dollar to reflect our dwindling productive capacity as a nation. We then decided to bitch and moan about China's currency not reflecting their increased productive capacity, only reason Geithner is complaining is he must think only the USA can mess around with its currency, everybody else has to play by the rules....

So don't thank the job creators, thank the federal reserve and policy makers for selling the middle class to China.

Our productive capacity hasn't dwindled at all- we currently have unused capacity. What we don't have is real demand for production, namely the money to buy it. It has little to do with the FRB, who are currently near helpless in a liquidity trap, and everything to do with the way income is distributed. The mechanisms that send money to the top are quite robust, while the mechanisms that send it back down again in the form of jobs, wages, benefits, taxes & govt spending have been terribly weakened.

Debt is the mechanism employed to conceal the reality of Reaganomics. Instead of the govt taking what was needed in the form of taxes, it borrowed instead. Instead of a raise, or better benefits, or increased value of the commons, workers got a bigger line of credit, culminating in the Ownership Society. It's called financialized capitalism, and it's inherently exploitative and unstable because it rewards risky behavior by financiers tremendously. By the time it falls down, they got theirs, and none of the rest of it matters to them at all.

BTW, Job Creators and policy makers are the same people, at least when Repubs are running things. There's differential recognition to various ques from political figures- The financial community knew that the Bushistas gave them a license to lie, cheat and steal, while most of the homeowning middle class just thought it was great that their property values had increased, and borrowed against it to buy lots of schlock from Guangdong.

Score! And Bailout! Woo-Hoo!

Now row, you debt slave suckas! Row! Blame the Chinese! Blame the ebil libruhls! Blame anybody but yourselves and the people who took advantage of you, the people you believe in so fervently. Pay up, chumps!

 

[BansheeX]

Good luck with that. If they dump treasuries, the Fed will buy them up with dollars to maintain the target interest rates. More dollars in circulation, dollar depreciates, Chinese exports become less competitive, economic problems and political unrest for Beijing. It would be good stimulus for the US though if the Chinese start investing in everything.

This is an absurd perspective. They are essentially trading products for a never ending stream of paper that can never be spent. Exporting (or more aptly, trade itself) only makes sense if you are getting imports of equal value in return now or in the future. I'm not exactly sure what value U.S. paper that can never be spent is. The moment China stops devaluing, they are able to buy more of their own internal production and the cost of imported raw materials goes down. Just like Switzerland whose exports have been growing BECAUSE of massive appreciation in the Franc, not despite it.

 

[Jhhnn]

This is an absurd perspective. They are essentially trading products for a never ending stream of paper that can never be spent. Exporting (or more aptly, trade itself) only makes sense if you are getting imports of equal value in return now or in the future. I'm not exactly sure what value U.S. paper that can never be spent is. The moment China stops devaluing, they are able to buy more of their own internal production and the cost of imported raw materials goes down. Just like Switzerland whose exports have been growing BECAUSE of massive appreciation in the Franc, not despite it.

Oh, please. The over valued Swiss Franc is wreaking havoc with their exports, balance of trade, and with tourism, as well-

http://www.nytimes.com/2011/08/04/business/global/swiss-franc.html?pagewanted=all

 

[momeNt]

Our productive capacity hasn't dwindled at all- we currently have unused capacity. What we don't have is real demand for production, namely the money to buy it. It has little to do with the FRB, who are currently near helpless in a liquidity trap, and everything to do with the way income is distributed. The mechanisms that send money to the top are quite robust, while the mechanisms that send it back down again in the form of jobs, wages, benefits, taxes & govt spending have been terribly weakened.

Debt is the mechanism employed to conceal the reality of Reaganomics. Instead of the govt taking what was needed in the form of taxes, it borrowed instead. Instead of a raise, or better benefits, or increased value of the commons, workers got a bigger line of credit, culminating in the Ownership Society. It's called financialized capitalism, and it's inherently exploitative and unstable because it rewards risky behavior by financiers tremendously. By the time it falls down, they got theirs, and none of the rest of it matters to them at all.

BTW, Job Creators and policy makers are the same people, at least when Repubs are running things. There's differential recognition to various ques from political figures- The financial community knew that the Bushistas gave them a license to lie, cheat and steal, while most of the homeowning middle class just thought it was great that their property values had increased, and borrowed against it to buy lots of schlock from Guangdong.

Score! And Bailout! Woo-Hoo!

Now row, you debt slave suckas! Row! Blame the Chinese! Blame the ebil libruhls! Blame anybody but yourselves and the people who took advantage of you, the people you believe in so fervently. Pay up, chumps!

The Federal Reserve and the 20 Prime Dealers love that you continue to ignore their role in exporting the middle class to China in the form of unsound monetary policy.

The Federal Reserve System and the following all thank you for your brilliant propaganda and scarecrows

BNP Paribas Securities Corp.
Barclays Capital Inc.
Cantor Fitzgerald & Co.
Citigroup Global Markets Inc.
Credit Suisse Securities (USA) LLC
Daiwa Capital Markets America Inc.
Deutsche Bank Securities Inc.
Goldman, Sachs & Co.
HSBC Securities (USA) Inc.
Jefferies & Company, Inc.
J.P. Morgan Securities LLC
MF Global Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Mizuho Securities USA Inc.
Morgan Stanley & Co. LLC
Nomura Securities International, Inc.
RBC Capital Markets, LLC
RBS Securities Inc.
SG Americas Securities, LLC
UBS Securities LLC.

In the meantime I will continue diligently to work towards getting people to understand that America's wealth has been stolen and replaced in the form of debt by the Fed and their group of 20.

 

[BansheeX]

Oh, please. The over valued Swiss Franc is wreaking havoc with their exports, balance of trade, and with tourism, as well-

http://www.nytimes.com/2011/08/04/business/global/swiss-franc.html?pagewanted=all

So, what are you saying, that they're too rich? Why export for the sake of exporting? Why devalue to work more? Why not work less and buy more imports with a currency that's rising faster than your exports are falling?

 

[momeNt]

Oh, please. The over valued Swiss Franc is wreaking havoc with their exports, balance of trade, and with tourism, as well-

http://www.nytimes.com/2011/08/04/business/global/swiss-franc.html?pagewanted=all

All the more reason to have a currency that properly reflects the health of a nation's economy. Because over and undervalued currencies do not help nation's, they only help George Soros.