The View From 1776
Our Inflation is China’s Foreign Relations Weapon
Inflation (debasing the dollar) cuts in many directions, much more than just the recurrent speculation bubbles (most recently the Clinton era dot.com bubble and the current subprime mortgage meltdown).
- That is a very good article and all 8 pages are important.
Here is one thing we have to consider. China is diversifying away from exports and more to service and internal consumption and trade with other developing nations.
Currently, I read that exports to the U.S. are down to 18% and many factories have left China for lower wage nations as China's wages have risen. Now, Cambodia, Vietnam and other lower wage nations are getting many of the labor intensive low skill factories while China moves to more high tech, low wage manufacturing.
Their massive infrastructure building is amazing with fifty 10-million population cities scheduled for building, 40 nuclear power plants, a massive interstate highway system, etc. After the Olympics, they start preparing for the 2010 World's Fair.
However, the scariest thing is what the article keeps alluding to. "We don't think we have a problem." Our government thinks that this massive debt is somehow not that big a deal and that China is going to be like some long term friend.
In March we raised the debt ceiling to $10.2 trillion. In the bail out bill for Fannie and Freddie, they raised it to $10.6 which is slightly over $1 trillion more than we currently owe. In just the last four months they have seen the need to increase the debt ceiling as if they are expecting massive deficit spending.
I believe they will pass another stimulus package and tax revenues will be falling so, they are probably right that we will have massive deficit spending but, all that does is put more fuel on the fire.Posted by JanPBurr on 07/27 at 10:25 AM
- Did The View ever write an article warning about a housing bubble?
- Mr. Airth, thanks for asking.
See Liberal/Progressive Economics Pushes Us Off the Cliff
- Mr. Brewton, in a way I am sorry I asked because of your partisan approach to the subject.