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if they do this? where does that leave us?
11/29/07 --- - As I discussed previously, the Chinese currency wild-card may become relevant far sooner than expected. An effort by China to convert its $1.4 trillion U.S. Treasury holdings into euros is not viable for many reasons -- not the least of which is the European Central Bank's inability to absorb such an event. As China continues its rush away from supporting U.S. Treasuries and as Middle Eastern investors are buying them up in more diversified holdings, a new "currency exchange" is unfolding. Realizing that they cannot liquidate their holdings, it appears that the Chinese are currently using their U.S. Treasury holdings as collateral for euro denominated purchases and long term infrastructure transactions. In other words, they may be "liquidating" their holdings as collateral and, in so doing, effectively migrating to non-dollar value without ever having to officially dump their current Treasury holdings.
Therefore, collateralize the credit in dollars -- especially if you're long in dollars. The lender/financier won't call the note because you have it structured in such a way to both allow it to perform and hold illiquid collateral that no one wants. This essentially inflates euros. Although you can't sell dollars, the whole purpose of collateral is that it is a second source of payment -- collateral is there to down rate the risk of the loan. Secondary becomes irrelevant.
When February comes, the Chinese are going to do something as they will have to decide what the exposure is going to be with the treasury. As I see it they have to just dump the treasury. They only keep it because they can use it -- they have 43% direct/indirect of US treasuries so they'll dump them on the market.
The US Congressional pressures to decouple the RMB will work, but not in the way we want. Our plan includes helping them hold on to the treasuries, it does not involve them not holding the dollar anymore. The US wanted the tether to be part of the float. This will cause disenfranchisement of the US electorate (during primary season). February is also when public (media) will realize we won't pull out of this.
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We'd be in a world of hurt for sure. But I'm more concerned about this! (http://wonkette.com/politics/dept'-of-extraterrestrial-biological-entities-have-replaced-karl-rove/bush-just-taking-orders-from-space-alien-at-white-house-297617.php)
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I've been buying gold and distilled water!
CC
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It sucks that we have given China so much control of our country.
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Why is it that we Americans (US citizens) all believe that America's reign over the world is some holy, pre-ordained natural condition that absolutlely MUST be maintained or else the entire world will fall apart? Rome, Greece, Spain, France and even England have all at one time been major world powers and then gone through a decline, what makes everyone think the US is so different?
After the former major world powers saw a decline in their staus, the Earth continued to spin, time moved on and some other nation rose up. It's been our time for about a century now, and now it seems we're declining. Most likely we'll never see the power that we've known before, and time will continue to move on.
Are you all really so arrogant about being Americans that you believe we MUST be supreme, that it is the natural order of things? Are you really all so narrow minded and shortsighted that you cannot recall a time in history when the US wasn't the world's most powerful nation? Let there be no mistake, the 21st century WILL BE the Chinese century. Why can't you all just accept that and learn to cope with living in a world that isn't dominated by the US?
Homeless
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Why is it that we Americans (US citizens) all believe that America's reign over the world is some holy, pre-ordained natural condition that absolutlely MUST be maintained or else the entire world will fall apart? Rome, Greece, Spain, France and even England have all at one time been major world powers and then gone through a decline, what makes everyone think the US is so different?
After the former major world powers saw a decline in their staus, the Earth continued to spin, time moved on and some other nation rose up. It's been our time for about a century now, and now it seems we're declining. Most likely we'll never see the power that we've known before, and time will continue to move on.
Are you all really so arrogant about being Americans that you believe we MUST be supreme, that it is the natural order of things? Are you really all so narrow minded and shortsighted that you cannot recall a time in history when the US wasn't the world's most powerful nation? Let there be no mistake, the 21st century WILL BE the Chinese century. Why can't you all just accept that and learn to cope with living in a world that isn't dominated by the US?
Homeless
I don't beleive anyone views it as the USA being "Supreme" over the rest of the world. In spite of your liberal thoughts, the US sends far too much foreign aid and help to other countries asking basically nothing in return. We don't colonize in spite of what some tend to claim and the Chinese issue isn't so much our wish at domination but more of a hope the Chinese will use their power and economical gains wisely as far as the environment and human rights issues are concerned. The danger with the Chinese is the question "Are they using Capitalism against us?" They are becoming somewhat akin to the Borg of Str Trek fame , as the "assimilate" the rest of world.
"America, love it or leave it." seems to fit here for some reason.....:idea:
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"America, love it or leave it." seems to fit here for some reason.....:idea:
No way he, or any like him will dare leave....they will be the first to die beyond these borders.
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It sucks that we have given China so much control of our country.
Doom and gloom.....move out of the ****in country!!!!!!!!!!!!!!!!! Just believe in your country and what got us to where we are....you make me sick so go ****ing take a ride, you doom and gloomer...I can't stand your kind, I don't care how good you think you are, you are a cancer and an uneducated ass!!!!!
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I don't beleive anyone views it as the USA being "Supreme" over the rest of the world. In spite of your liberal thoughts, the US sends far too much foreign aid and help to other countries asking basically nothing in return. We don't colonize in spite of what some tend to claim and the Chinese issue isn't so much our wish at domination but more of a hope the Chinese will use their power and economical gains wisely as far as the environment and human rights issues are concerned. The danger with the Chinese is the question "Are they using Capitalism against us?" They are becoming somewhat akin to the Borg of Str Trek fame , as the "assimilate" the rest of world.
"America, love it or leave it." seems to fit here for some reason.....:idea:
Who do we send foreign aid to? Israel, mostly in the form of military assistance, Egypt, with strings attached saying they have to be moderate. Do you have ANY idea how we used money to manipulate Central and South American countries in the 80's under Regan? Did you think that all the money sent to right wing dictators in Chile, Guatemala and Honduras was sent just because we felt so bad for the poor South American people? Asking nothing in return, indeed.
Do you have ANY idea at all who receives US foreign aid and what is expected in return, or do you just automatically spring forth with hyper-patriotic BS when confronted with an honest issue about your country?
Are you honestly going to pretend that the US gives a rat's ass about human rights? If we did would China have most favored nation trading status? Would we have supported the El Salvadoran death squads in El Salvador?
People like you amaze me, the way you just repeat whatever you hear Charlie Daniels and Lee Greenwood say on Sean Hannity without ever taking the time to compare their rhetoric to FACTS ABOUT THINGS THAT ACTUALLY HAPPENED! It's like you're more comfortable with platitudes and slogans than with reality.
Why do I waste my time? You know what, nevermind, fill your stupid fat American heads with illusions and fantasies as your empire sinks, I'll be fine.
As far as the remark that I'd be too afraid to live beyond the borders of the United States, I ALREADY LIVE BEYOND THE BORDERS OF THE US, BECAUSE I AM A WORLD CITIZEN!!! You don't need to worry about me having trouble living beyond the borders of the US, what you need to think about is how people like YOU are going to be able to survive within the borders of the FORMER SUPERPOWER OF THE UNITED STATES when globalization and immigration reform erase the US border and force you all to figure out how to live as a World Citizens. Good luck to you and your redneck families,
Homeless
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Hey pansyass, me and my rednecks, we dont need luck.....we got GUNS!
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