There is no reason to believe that the PRC bandits cannot use another currency to function as they use the dollar. (Euro).
And yet there are plenty of reasons why they will not.
Let's look at this.
- America has financial problems, but Europe's are even worse (Greece being the latest expression of that), making ?-bonds less attractive.
- They have more capital bound up in US bonds than anyone else, and thus have a relatively high interest in not dumping and thus devaluing them.
- Their trade surplus with America will evaporate. Indeed, America has pressured China (but not too loudly) for years now to let the Yuan rise for just this reason.
And what happens when their version of the subprime bubble pops? We OWN that debt one step removed as payees.
That is because they have no free internal credit mechanism and consumption to soak up excess production. 1927 America in a nutshell repeated. Wonder if their real estate base and agriculture is as messed up as our own was/is. (It is.)
This lack of economic strategic depth also makes it extremely unlikely they'll engage in overt economic warfare, especially not with a nation as economically resilient as the US.
Its also a firewall that prevents a ripple effect to the Chinese rural poor. We went down under a series of speculator engineered hammer blows that started with the collapse of return on lending to our middle class. All of that capital had been bundled into unsecured real estate and commodities futures speculation (For another ponzi scheme like this insanity in real estate that locked up small business capital credit investment, look at CAP AND TRADE, where carbon credits will be traded as a commodity. When will WE learn?)
They have enough undervaluation to soak up the 10% difference. We can't afford the added 1 or 2 points of interest. Can't you see this?
Higher interest on the debt would be more than offset by a resurgence exports across the board and in American manufacturing in particular. Both are paths to a more sustainable economy anyway. This is again why American policy has been for some time to "encourage" China to allow the Yuan to rise. It is in no one's interest for China to suffer an inflationary crash, either.
There are no exports if there is no production capacity or capability. When did you buy an American toaster or TV set last? We are a service economy not an industrial one.
No there isn't. Who has a slave labor command economy that can feed the debtor fix? Nobody.
To borrow a phrase, There is no reason to believe that Americans can't absorb the added cost of cheap toasters from Maquiladores v
Let's look at this.
American exposure is $50 billion and rising. What was Lehman Brothers exposure that ended in the September 28, 2008 cascade market attack that wiped out $4 trillion in real wealth? What did we just suffer last Friday and what started that $1 reillion loss oin wealth? Hint: currency speculators sold short on the Euro. That would be the PRC bandits along with some of the other bastards of the MFA, including the Soros group at Quantum.
Japan. They are using US as derivatives to leverage their own debt. Talk about a mutual suicide pact! Besides the PRC real estate market such as it is, is about to tango uniform.
And what happens when their version of the sub prime bubble pops? We OWN that debt one step removed as payees.
Its also a Great Wall that prevents a ripple effect to the Chinese rural poor. We went down under a series of speculator engineered hammer blows that started with the collapse of return on lending to our middle class. All of that capital had been bundled into unsecured real estate and commodities futures speculation (For another ponzi scheme like this in
A country needs to master fission and rays before it can start on Teller Ulam let alone contained fusion. There is no reason to believe the NorKs have acquired sufficient material or experience they could even be close to any sort of meaningful fusion. The usual self-inflating rhetoric, methinks, else Kim "fused" some political opponents together with isotopes for experimental entertainment value.
Good to learn that I contribute some value to the SP community ;>) According to public reportage the PRC already possesses advanced teller ulam designs and supportive data to enable appreciation of how these operate. Why would the PRC invest substantially in commercial fusion technologies when they can simply steal them from consortia of other nations and avoid the financial hit? PRC supercomputer access is limited as well. I frankly doubt the PRC will lead development and the NorKs have much less chance in this respect as in between slim and none and Slim is on vacation. 0.02
PRC supercomputer access is limited as well.
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