If USD collapses

[Dr_Who]

Very interesting Peat, thanks for the article. Do you have a link?

The world is totally stuffed with the exception of China.

[patsy]

Very interesting Peat, thanks for the article. Do you have a link?

The world is totally stuffed with the exception of China.

If you went to China (as I did just two weeks ago), you'd see that the Chinese are in "ultra panic mode". There is an unbelievable idle overcapacity in factories. The peasants, who not long ago thought of "making a killing" as factory workers are moving back from cities to the country after relentless layoffs. The Chinese are propaganda masters - the reality is far from what they try to make us believe in the West.

[peat]

from this article : http://www.businessspectator.com.au/...cument&src=kgb

came this link : http://www.businessspectator.com.au/...T?OpenDocument

which doesnt actually contain exactly what I posted, but is as close as I can find again now.

[peat]

the Chinese are in "ultra panic mode

http://www.bloomberg.com/apps/news?p...d=ahxBcUdeeYxE

China’s 2009 Rebound Is Pure Fantasy: William Pesek (Update1)



this really is the all consuming thread !

[winner69]

The Chinese are propaganda masters - the reality is far from what they try to make us believe in the West.

Wasn't that many years ago the Chinese GDP figure came out before the end of the period it was measuring ...... prob making it up as they went along was the consensus

[patsy]

Wasn't that many years ago the Chinese GDP figure came out before the end of the period it was measuring ...... prob making it up as they went along was the consensus

What I've seen over recent years in China/India (through my work) is that there is a certain mystique about those two countries, mixed up with some PC and the sense that it is "cool" in the West to talk up the China/India economies. The reality is a little different. The problem is that most people make comments about them and even financial decisions are made on the basis of some superficial newspaper article or some socialist-driven commentary in The Economist. No-one can deny the significant growth that they experienced but, again, a first-hand look at what's going on there can leave anyone with a completely different opinion.

[ananda77]

Business spectator

...there is no doubt that a huge shortfall still exists.[/FONT]

The implication of this is clear: European banks funded themselves with dollars during the boom and the capital destruction of the past year has left them starved of dollars and scrambling to get them.

That’s why the US dollar has been so strong and why it seems likely to keep going up, despite the colossal mess in the US financial system."

...as I mentioned before, it is not only the European banks starving as the total outstanding US$ denominated credit market debt = FIFTY TWO TRILLION

...no matter how fast US$ are put into circulation, skyrocketing the money supply, at the same time, the velocity of money simply goes into the opposite direction as the increased money supply is sucked into the huge BLACK HOLE OF DEBT

...in the very short term a USD correction to the 82 level possible

...at the same time, the securitization market is DEAD and despite all efforts remains DEAD as long as the debt still remains unpurged from the system

...stay in cash because it is needed when the financial system takes a holiday

Kind Regards

[ananda77]

...for all those people pinning their hopes on CHINA:

The U.S. Financial System Is Effectively Insolvent

There is a grave risk of a global L-shaped depression.

By Nouriel Roubini

...So without a recovery in the U.S. and global economy, there cannot be a sustainable recovery of Chinese growth. And with the U.S, recovery requiring lower consumption, higher private savings and lower trade deficits, a U.S. recovery requires China's and other surplus countries' (Japan, Germany, etc.) growth to depend more on domestic demand and less on net exports. But domestic-demand growth is anemic in surplus countries for cyclical and structural reasons. So a recovery of the global economy cannot occur without a rapid and orderly adjustment of global current account imbalances.
http://www.forbes.com/2009/03/04/glo...onomy.html?321

Kind Regards

[Dr_Who]

If you went to China (as I did just two weeks ago), you'd see that the Chinese are in "ultra panic mode". There is an unbelievable idle overcapacity in factories. The peasants, who not long ago thought of "making a killing" as factory workers are moving back from cities to the country after relentless layoffs. The Chinese are propaganda masters - the reality is far from what they try to make us believe in the West.

I travel to China a couple of years back for a holiday. Amazing place. I too agree with what you are saying. These days, you dont know who to believe. Everyone is telling fibs, from the Chinese to the Americans. All the CEO from the large investment banks are bull**** artists. No wonder investors have lost confidence and buying gold. It will take a long time to restore investor confidence again after this tragic event.

[patsy]

...for all those people pinning their hopes on CHINA:

The U.S. Financial System Is Effectively Insolvent

The Chinese have now a big dilemma.... similar to a poker player that has to keep on calling and raising bets. On the one hand, they have become the buyers of a big proportion of US Govt bonds - the Americans need the Chinese to fund the bailout. This presents a good opportunity for the Chinese: they can just close the tap and see the US$ collapse and challenge World hegemony. But if they did so, the trillion dollars or so they already hold on Treasure notes would be wiped out. So what should Chinamen do?, they ask themselves. It is a classic example of prisoner dilemma - they can both go down or they can share the pain.