Tuesday, February 21, 2006
Im I gettin old ?
Suddenly I understood that US is using 3bio$ a day (on wars and cashback deals on cars) - and that 45% of the money comes from issuing bonds to China and Japan. That must become a fu..... big poblem over time. Specially if the whole american idea of building a country on intelectual property(patents, entertainment, software...) fails. (But no wonder they throw a 100mio$ now and then to enforce intelectual property into countries like India and Brazil).
Why the f... do i think about stuff like this - well maybe Im getting old.
Suddenly I understood that US is using 3bio$ a day (on wars and cashback deals on cars) - and that 45% of the money comes from issuing bonds to China and Japan. That must become a fu..... big poblem over time. Specially if the whole american idea of building a country on intelectual property(patents, entertainment, software...) fails. (But no wonder they throw a 100mio$ now and then to enforce intelectual property into countries like India and Brazil).
Why the f... do i think about stuff like this - well maybe Im getting old.
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As in 500 Bio$ in deficit on the government budget and 50 Bio$ on their trade balance.
One of the reasons the yanks are still floating is that China and India have no interest to pop this baloon because this will cause a devaluation/drop of the dollar and therefore develation of their huge loan/bonds to the US... until they think its time. Basically China and India almost own the US, or at least have control over it's future. However be smart...go and fight a war in Iraq - MMOG for grown ups.
One of the reasons the yanks are still floating is that China and India have no interest to pop this baloon because this will cause a devaluation/drop of the dollar and therefore develation of their huge loan/bonds to the US... until they think its time. Basically China and India almost own the US, or at least have control over it's future. However be smart...go and fight a war in Iraq - MMOG for grown ups.
Hi Morten,
You don’t have to worry about you getting old coz the problem in general is with respect to the US trade deficit which increased to $725.8 billion in 2005 from $617.6 billion in 2004. Over a quarter of this trade deficit could be attributed to China, no wonder the lawmakers in the US fret over China’s refusal to revalue its currency and ask it to not do some lip-service by adjusting it a few percentage points. This deficit is alarming and it’s showing no signs of abating.
With respect to the US bonds, developing countries especially China has interest in buying up those bonds, because the money that they incur in buying those bonds inevitably results in increased consumer spending in the US which would mean increased imports read increased exports for China.
Also worth noting is the amount of reserves that a few countries have. Japan has the world's biggest foreign currency reserves, with $846.9bn, but at the rate at which China is growing, Chinese reserves could overtake Japanese, hitting $1 trillion this year. Currently China has about $814bn in reserves. Most of these reserves are dollar backed assets in the form of bonds and securities.
Your point on Intellectual property is something I find hard to agree with. US is, what it is, because of these intangibles like patents, Cutting-edge innovation and relentless pursuit in R&D. It has served US well for centuries, and would continue to do so for a long time to come. To think that such a system would fail in the US is equivalent to thinking U2 as guys who play Jazz and flute and not some heavy metal rock stuff.
Well I don’t know much sense I made, or how much value input u could gather, but “when in doubt, press Alt-f4”. Cheers.
P.S. Hey mads, I would love to see how you respond to Morten’s fears.
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You don’t have to worry about you getting old coz the problem in general is with respect to the US trade deficit which increased to $725.8 billion in 2005 from $617.6 billion in 2004. Over a quarter of this trade deficit could be attributed to China, no wonder the lawmakers in the US fret over China’s refusal to revalue its currency and ask it to not do some lip-service by adjusting it a few percentage points. This deficit is alarming and it’s showing no signs of abating.
With respect to the US bonds, developing countries especially China has interest in buying up those bonds, because the money that they incur in buying those bonds inevitably results in increased consumer spending in the US which would mean increased imports read increased exports for China.
Also worth noting is the amount of reserves that a few countries have. Japan has the world's biggest foreign currency reserves, with $846.9bn, but at the rate at which China is growing, Chinese reserves could overtake Japanese, hitting $1 trillion this year. Currently China has about $814bn in reserves. Most of these reserves are dollar backed assets in the form of bonds and securities.
Your point on Intellectual property is something I find hard to agree with. US is, what it is, because of these intangibles like patents, Cutting-edge innovation and relentless pursuit in R&D. It has served US well for centuries, and would continue to do so for a long time to come. To think that such a system would fail in the US is equivalent to thinking U2 as guys who play Jazz and flute and not some heavy metal rock stuff.
Well I don’t know much sense I made, or how much value input u could gather, but “when in doubt, press Alt-f4”. Cheers.
P.S. Hey mads, I would love to see how you respond to Morten’s fears.
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