tag:blogger.com,1999:blog-6859126.post721222929418583818..comments2023-10-28T06:41:07.069-07:00Comments on Ambition, Impatience and Sloth: Davidhttp://www.blogger.com/profile/06427208386709900367noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-6859126.post-36833485008035527752007-12-27T06:30:00.000-08:002007-12-27T06:30:00.000-08:00You've got it exactly right. China is a great exam...You've got it exactly right. China is a great example of what holding US debt can do to help your international trade position. They murder the environment, they hold the yuan down artificially at the expense of their own people to keep their exports high, they have (to put it politely) highly suspect labor laws and conditions, they have a huge military build-up under way in the pacific, etc etc. Yet, they maintain their very favorable trading aggreements with the US, because they are holding a significant amount of I.O.U.s.<BR/><BR/>The problem is that the right wing free market fanatics see no problem with any of these, since they believe that unregulated growth, in theory, will find the best path, so there's no harm in letting places like China go hogwild, doing whatever they want. It results in cheap goods for the US, plus they keep putting all their profits back into the US economy in order to be able to keep making profits. Now, this is a significant advantage, and one that China cannot get by investing in, say, the solid economy of Belgium. The symbiotic relationship will most likely continue on semi-solid footing from an economist's point of view; whether it should, from a secular humanist's point of view, should be the argument the Dems have to make.Feralhttps://www.blogger.com/profile/09812523941671650852noreply@blogger.comtag:blogger.com,1999:blog-6859126.post-81049058916817552232007-12-26T15:52:00.000-08:002007-12-26T15:52:00.000-08:00This is true, and you certainly have a better unde...This is true, and you certainly have a better understanding of the underlying issues than I do. But I'd think the central bank creditors wouldn't even need to pull the plug; just by virtue of the threat, they can exert a lot of influence. <BR/><BR/>Some cynical people might even claim this is already happening, in areas like, I dunno, regulations concerning the safety of imported toys from China. It's always bad form to criticize your banker's manners.<BR/><BR/>Otherwise, as other economies come to represent better bets, the relative appeal of owning our debt presumably will decrease, no?Davidhttps://www.blogger.com/profile/06427208386709900367noreply@blogger.comtag:blogger.com,1999:blog-6859126.post-24327322466478973892007-12-26T14:03:00.000-08:002007-12-26T14:03:00.000-08:00The bet the no-tax republicans are making, is that...The bet the no-tax republicans are making, is that the foreign creditors will never decide that the party’s over. The US still has the biggest economy in the world (by far) and the largest sphere of influence in the world (for better or worse), and some morons are betting that people worldwide will always be interested in being in the US business, and therefore will never cash in all their chips, no matter how dreary the US economy turns. They are betting that owning a piece of the US is like owning IBM or GE stock; you don’t sell when it goes down to buy stock in a hot start-up, you’re in it for the long haul. Now, the no-tax morons may be right, but it’s still a stupid and unnecessary bet. Even if you’re betting with 1000 to 1 odds, if you keep betting forever, you will eventually lose on the sure thing.Feralhttps://www.blogger.com/profile/09812523941671650852noreply@blogger.com