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(The Australian)   China says it is "fully prepared" for a currency war with the rest of the world. U.S. immediately complains about going into battle unarmed   (theaustralian.com.au) divider line 48
    More: Interesting, Japan, People's Bank of China, currency war  
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1502 clicks; posted to Business » on 04 Mar 2013 at 8:32 AM (1 year ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2013-03-04 08:13:10 AM
You go to economic war with the currency you have, not the currency you might want or wish to have at a later time.
 
2013-03-04 08:34:34 AM
A good part of their money is invested in dollars, we'll do fine.
 
2013-03-04 09:04:46 AM
We owe our debts in dollars and we can print as many as we need to.

Bring it on, motherfarkers.
 
2013-03-04 09:12:28 AM
Our GDP is still double theirs...
 
2013-03-04 09:18:59 AM
If only the currencies were actually based in realty
 
2013-03-04 09:21:51 AM
But just think about the potential income they have from the condos in all their ghost cities!
 
2013-03-04 09:33:22 AM
really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.
 
2013-03-04 10:05:24 AM

AuralArgument: These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.


You put your weed in there.
 
2013-03-04 10:10:03 AM

AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.



So you'd have a lot of American made goods sitting on shelves taking up space and people would continue to buy the cheaper foreign products. This would benefit companies like Amazon that can just put things in a warehouse but it would hurt small retail stores a lot.
 
2013-03-04 10:11:17 AM
dittybopper:

You put your weed in there.

24.media.tumblr.com
 
2013-03-04 10:35:34 AM

AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.


Or Americans could just get off their ass and make better products
 
2013-03-04 10:53:35 AM

Lost Thought 00: AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.

Or Americans could just get off their ass and make better products


You need investment capital in order to do so. Lots of Americans make great stuff, but there is no funding to back them. That's the main reason why things like Etsy and direct sell Amazon are where the new talent is. The corporations have little reason to invest locally.

Really the only "solution" will be some sort of fuel scarcity making long term transport prohibitive.
 
2013-03-04 11:33:10 AM

Lost Thought 00: AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.

Or Americans could just get off their ass and make better products


American's make great products already they are just expensive and people don't want to spend the money. The only exception is consumer electronics but even that is starting to change again.
 
2013-03-04 12:41:19 PM
you mean china isn't waging a currency war right now by artificially keeping the yuan so low?
 
2013-03-04 12:51:25 PM

Lost Thought 00: AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.

Or Americans could just get off their ass and make better cheaper products


The Middle Class in a capitalist market does not want better products. They want cheaper products. Whether it is food or furniture, experience has shown us that cheap crap sells better than better made more expensive products.
 
2013-03-04 01:07:01 PM
good, we should fight this war. and we should have been fighting this war for the last 20 years. because we would win it and we have alot to gain from it.
 
2013-03-04 01:08:57 PM

MugzyBrown: If only the currencies were actually based in realty


currencies have never been based in reality. ever.
even when currencies were based on gold, it was the perceived value of gold that gave gold any value at all.  At any point in time people could have just up and dropped gold and switched to salt or corn or a basket of goods.

golds value was that it was scarce enough and impossible to "copy" that it could be used as a convenient barter intermediate. WHY the fark would you need 5 sheep? here is the "coin" equiv. Now you can go buy 1 sheep, 10 chickens, and 1 cow.

the only difference with paper currency is that we can choose to devalue it by printing more at any point in time. You can not do that with gold. Strange, you CAN go MINE more gold, which greatly devalues gold.

do the GOLD people ever read up on what happened when new gold mines were discovered?
do the GOLD people ever realize that we used to have massive inflation even on the GOLD standard?
LOLOLOLOL

or would we just ban gold mines in this future gold-topia?
 
2013-03-04 01:09:20 PM

not5am: you mean china isn't waging a currency war right now by artificially keeping the yuan so low?


china has been waging this war for 20 years and is winning because we didnt even show up. all it takes is for us to shwo up and we would win because china needs us more than we need them.
 
2013-03-04 01:13:25 PM

GF named my left testicle thundercles: good, we should fight this war. and we should have been fighting this war for the last 20 years. because we would win it and we have alot to gain from it.


like?
China calls in our debt (or dumps it on the open market), dollar drops like a stone, price of imports skyrocket, price of exports drop. So good for manufacturers (we still have those?), bad for consumers, bad for the US overall. Bad for travel, bad for pretty much everything.

Sure we can win the war trivially. We just print 2x the money to cover all current outstanding debt and payoff all of our debt. Alas ... we also crash into the ground. YAY we won!!

/how about a new currency based on .... oh nevermind
 
2013-03-04 01:24:55 PM

GF named my left testicle thundercles: not5am: you mean china isn't waging a currency war right now by artificially keeping the yuan so low?

china has been waging this war for 20 years and is winning because we didnt even show up. all it takes is for us to shwo up and we would win because china needs us more than we need them.


why do we want to remind someone that they're selling us their natural resources at rock bottom prices?
 
2013-03-04 01:47:32 PM

namatad: GF named my left testicle thundercles: good, we should fight this war. and we should have been fighting this war for the last 20 years. because we would win it and we have alot to gain from it.

like?
China calls in our debt (or dumps it on the open market), dollar drops like a stone, price of imports skyrocket, price of exports drop. So good for manufacturers (we still have those?), bad for consumers, bad for the US overall. Bad for travel, bad for pretty much everything.

Sure we can win the war trivially. We just print 2x the money to cover all current outstanding debt and payoff all of our debt. Alas ... we also crash into the ground. YAY we won!!

/how about a new currency based on .... oh nevermind


so consumers will have to buy shiat from the US and not from overseas. that will support more jobs for us. additionally, it will give other nations more incentive to buy our goods (yes the US is a major exporter) that support even more jobs. every single nation that became dominant was extremely protectionist during its ascendancy.

but OH NO TUBE SOCKS AT WALLMART ARE NOW 10$ instead of 1$. maybe that will help us save money instead of go into retarded debt.
 
2013-03-04 01:48:13 PM

not5am: GF named my left testicle thundercles: not5am: you mean china isn't waging a currency war right now by artificially keeping the yuan so low?

china has been waging this war for 20 years and is winning because we didnt even show up. all it takes is for us to shwo up and we would win because china needs us more than we need them.

why do we want to remind someone that they're selling us their natural resources at rock bottom prices?


so that we can produce our own natural resources instead of buying them.
 
2013-03-04 01:57:23 PM

GF named my left testicle thundercles: so consumers will have to buy shiat from the US and not from overseas. that will support more jobs for us. additionally, it will give other nations more incentive to buy our goods (yes the US is a major exporter) that support even more jobs. every single nation that became dominant was extremely protectionist during its ascendancy.


Ya know what's great for a country? Making 95% of the population pay higher prices for everything to create  jobs and wealth for 5% of the country.
 
2013-03-04 01:58:23 PM

namatad: China calls in our debt (or dumps it on the open market), dollar drops like a stone, price of imports skyrocket, price of exports drop. So good for manufacturers (we still have those?), bad for consumers, bad for the US overall. Bad for travel, bad for pretty much everything.


First of all, you cannot "call in" bonds.  Where on earth do people get this idea?

Secondly, US Treasury bonds exist solely on a computer at the US Treasury (the US has not issues paper bonds in 20+ years) and all transactions are handled in US dollars.  If the Chinese were to sell their bond holdings (which really aren't all that much in the grand scheme of things), they would then have a large pile of dollars in the Chinese government account at the NY Federal Reserve, earning exactly 0 interest.  In the end, dollars are only good for buying US goods & services or buying US assets (and paying US taxes, I suppose) - either they will (if indirectly) buy goods & services from the US (awesome) or they are simply exchanging one type of asset (Treasury bonds) for another, which is the macro-economic equivalent of a no-op.  Or they could just set fire to those dollars, I suppose.

And if the above circumstance were to occur, the Federal Reserve would simply mop up any bonds the Chinese were selling to hold interest rates relatively steady.  Unless those dollars make their way back to the US in the form of US exports or asset purchases, it is highly unlikely to cause any direct domestic inflation.  The Yuan may rise against the dollar, but that only hurts Chinese manufacturing - why on earth would they want to do that to themselves?
 
2013-03-04 02:09:44 PM

dittybopper: You go to economic war with the currency you have, not the currency you might want or wish to have at a later time.


Yeah, well we know that now...

/The problem with the Euro was that the whole idea of it working was that people would use the common monetary system to prepare for regional crises, and they didn't.
 
2013-03-04 02:19:03 PM

MugzyBrown: GF named my left testicle thundercles: so consumers will have to buy shiat from the US and not from overseas. that will support more jobs for us. additionally, it will give other nations more incentive to buy our goods (yes the US is a major exporter) that support even more jobs. every single nation that became dominant was extremely protectionist during its ascendancy.

Ya know what's great for a country? Making 95% of the population pay higher prices for everything to create  jobs and wealth for 5% of the country.


wrong, free trade makes us workers compete with starving peasants which causes our wages to go down and our real purchasing power to go down too. so you buy a 1$ tube sock from wallmart but now the supply of labor is 1.3 billion people larger so your job pays nothing. why do you think the average workers wages began to stagnate at the same time free trade started? free trade benefits the elites and hurts the average guy.
 
2013-03-04 02:44:13 PM

GF named my left testicle thundercles: wrong, free trade makes us workers compete with starving peasants which causes our wages to go down and our real purchasing power to go down too. so you buy a 1$ tube sock from wallmart but now the supply of labor is 1.3 billion people larger so your job pays nothing. why do you think the average workers wages began to stagnate at the same time free trade started? free trade benefits the elites and hurts the average guy.


Acutally wages started stagnating once Nixon killed the convertability of US Dollars to Gold.
 
2013-03-04 02:52:15 PM
You know China's not talking to the US...right? They're smart people. An economic spat of any significance with a major economic power outside the region only leaves the door open for another Asian country to take their place at the top. They're warning Japan, not the US.
 
2013-03-04 03:12:53 PM

OptionC: either they will (if indirectly) buy goods & services from the US (awesome)


Not exactly sure why this is awesome.  China buying large amounts of goods/services from the US would simply be an influx of paper currency into the US and an outflow of real goods and actual labor.  I'm not ecstatic about China buying up massive amounts of our natural resources, or whatever.
 
2013-03-04 03:43:39 PM

GF named my left testicle thundercles: not5am: GF named my left testicle thundercles: not5am: you mean china isn't waging a currency war right now by artificially keeping the yuan so low?

china has been waging this war for 20 years and is winning because we didnt even show up. all it takes is for us to shwo up and we would win because china needs us more than we need them.

why do we want to remind someone that they're selling us their natural resources at rock bottom prices?

so that we can produce our own natural resources instead of buying them.


?  I'm not going to argue about how one 'produces' a 'natural' resource... but let's just say you meant, mine/refine/use our natural resources to produce good.  All type of goods.  Both high end durable (think Caterpillar machinery) as well as small (think drain stopper) consumer goods, which China does a lot more of low end consumer vs. high end, then we'd have the same problem they do...  you don't just produce, without by-product.
www.againstcronycapitalism.org
POLLUTION
 
2013-03-04 03:47:24 PM
War, is what is in the air.
War, is what is coming there.
War, is like a machine.
War, is about to begin.
socioecohistory.files.wordpress.com
 
2013-03-04 03:49:39 PM

MattStafford: OptionC: either they will (if indirectly) buy goods & services from the US (awesome)

Not exactly sure why this is awesome.  China buying large amounts of goods/services from the US would simply be an influx of paper currency into the US and an outflow of real goods and actual labor.  I'm not ecstatic about China buying up massive amounts of our natural resources, or whatever.


So.... should the United States ban all exports because it is simply an exchange of real goods for paper currency?  Should China follow the same logic?  Europe?  Saudi Arabia?

You don't want to go too far in one direction or the other, but bringing the current account with China closer to balance  than it currently is via increased US exports  would be good for both countries in the long term and would probably help lower unemployment in the US in the short-term.
 
2013-03-04 03:56:14 PM

AuralArgument: really here is a simple way to bring back North American Jobs without restricting trade.

at least 30% of manufactured goods in "any given retail establishment"1 Must be given over to North American Made products of that 10% must be made within 300 miles of the nearest major population center of over 250,000 of said store.

Also tax incentives should be given to companies on the North American exchanges who buy from at least 75% North American manufactures and manufactures who source from within North America.

A social safety net tax should be levied on any company that imports more then 50% of it's consumer ready goods for the good of the country as a whole.

I have no problem with Europe/Asia doing the same back to us.


1 Exemptions made for specialty import stores exceeding no more then 5000 square feet of public retail space. These stores must import directly from the country of origin and must be focused in on culturally significant product or product with no North American Equivalent.


Yes, that would bring on a trade war with the EU. (I assume you mean the EU, Europa and Asia are continents, not economic entities).

How would that not restrict trade?

I'd be fine with you just saying "yeah, I don't want the USA to trade with anyone", I could argue the merits of that. But you want both that, and not restricted trade?
 
2013-03-04 04:38:30 PM

namatad: MugzyBrown: If only the currencies were actually based in realty

currencies have never been based in reality. ever.
even when currencies were based on gold, it was the perceived value of gold that gave gold any value at all.  At any point in time people could have just up and dropped gold and switched to salt or corn or a basket of goods.

golds value was that it was scarce enough and impossible to "copy" that it could be used as a convenient barter intermediate. WHY the fark would you need 5 sheep? here is the "coin" equiv. Now you can go buy 1 sheep, 10 chickens, and 1 cow.

the only difference with paper currency is that we can choose to devalue it by printing more at any point in time. You can not do that with gold. Strange, you CAN go MINE more gold, which greatly devalues gold.

do the GOLD people ever read up on what happened when new gold mines were discovered?
do the GOLD people ever realize that we used to have massive inflation even on the GOLD standard?
LOLOLOLOL

or would we just ban gold mines in this future gold-topia?


Thanks for fighting the good fight and chasing the windmill that is "trying to point out to a gold-standard-bearer just why everyone is laughing at him".
 
2013-03-04 05:54:22 PM

not5am: you mean china isn't waging a currency war right now by artificially keeping the yuan so low?


Just like we aren't either with "quantitative easing".  That's a catchy new term for "printing up a metric shiatload of new money".
 
2013-03-04 06:08:59 PM
Only an idiot would think the future of America is in manufacturing.

Why are people drooling over the prospect of lowest-tier jobs requiring no intelligence?

Keep your manufactuing you, smelly, smog encrusted hellhole that is China.
 
2013-03-04 06:13:21 PM

MugzyBrown: GF named my left testicle thundercles: wrong, free trade makes us workers compete with starving peasants which causes our wages to go down and our real purchasing power to go down too. so you buy a 1$ tube sock from wallmart but now the supply of labor is 1.3 billion people larger so your job pays nothing. why do you think the average workers wages began to stagnate at the same time free trade started? free trade benefits the elites and hurts the average guy.

Acutally wages started stagnating once Nixon killed the convertability of US Dollars to Gold.


No, it was the rise of MBAs as policy-makers at big companies and the increasing use of computers to increase efficiency and reduce headcount which flooded the labor market and started the labor devaluation.
 
2013-03-04 06:44:56 PM

namatad: MugzyBrown: If only the currencies were actually based in realty

currencies have never been based in reality. ever.
even when currencies were based on gold, it was the perceived value of gold that gave gold any value at all.  At any point in time people could have just up and dropped gold and switched to salt or corn or a basket of goods.

golds value was that it was scarce enough and impossible to "copy" that it could be used as a convenient barter intermediate. WHY the fark would you need 5 sheep? here is the "coin" equiv. Now you can go buy 1 sheep, 10 chickens, and 1 cow.

the only difference with paper currency is that we can choose to devalue it by printing more at any point in time. You can not do that with gold. Strange, you CAN go MINE more gold, which greatly devalues gold.

do the GOLD people ever read up on what happened when new gold mines were discovered?
do the GOLD people ever realize that we used to have massive inflation even on the GOLD standard?
LOLOLOLOL

or would we just ban gold mines in this future gold-topia?


This is the dumbest thing I've ever read.  I never understand why people feel the need to opine of subjects they obviously know nothing about.
 
2013-03-04 08:59:00 PM
It's cool. We've been secretly slipping heavy gold coins into circulation, and we'll call for a trial of the Pyx as soon as it's politically advantageous.
 
2013-03-04 09:53:57 PM

Lost Thought 00: Or Americans could just get off their ass and make better products

deploy robots and undercut Chinese labor

A few reports have suggested that traditional human labor manufacturing will never see a return to the golden era it once had in the US.  More and more will be done by robots.


spawn73: Yes, that would bring on a trade war with the EU.


If it even got that far.  The second such a law is passed, a member country of the WTO would file a complaint.
 
2013-03-04 10:13:31 PM
Gentlemen. It has been a privilege playing with you tonight.

news.bbcimg.co.uk
 
2013-03-04 10:26:25 PM

PapaChester: Only an idiot would think the future of America is in manufacturing.

Why are people drooling over the prospect of lowest-tier jobs requiring no intelligence?

Keep your manufactuing you, smelly, smog encrusted hellhole that is China.


Because the "lowest tier" workers still need income, and that income comes either from low level jobs, the government, or crime.

/I live in southern China
//blue skies, temps in mid 60s today
///might just head out to the islands
 
2013-03-04 10:27:44 PM

OptionC: namatad: China calls in our debt (or dumps it on the open market), dollar drops like a stone, price of imports skyrocket, price of exports drop. So good for manufacturers (we still have those?), bad for consumers, bad for the US overall. Bad for travel, bad for pretty much everything.

First of all, you cannot "call in" bonds.  Where on earth do people get this idea?

Secondly, US Treasury bonds exist solely on a computer at the US Treasury (the US has not issues paper bonds in 20+ years) and all transactions are handled in US dollars.  If the Chinese were to sell their bond holdings (which really aren't all that much in the grand scheme of things), they would then have a large pile of dollars in the Chinese government account at the NY Federal Reserve, earning exactly 0 interest.  In the end, dollars are only good for buying US goods & services or buying US assets (and paying US taxes, I suppose) - either they will (if indirectly) buy goods & services from the US (awesome) or they are simply exchanging one type of asset (Treasury bonds) for another, which is the macro-economic equivalent of a no-op.  Or they could just set fire to those dollars, I suppose.

And if the above circumstance were to occur, the Federal Reserve would simply mop up any bonds the Chinese were selling to hold interest rates relatively steady.  Unless those dollars make their way back to the US in the form of US exports or asset purchases, it is highly unlikely to cause any direct domestic inflation.  The Yuan may rise against the dollar, but that only hurts Chinese manufacturing - why on earth would they want to do that to themselves?


+smart

Treasury bonds are not dollars.
 
2013-03-04 10:46:14 PM

OptionC: In the end, dollars are only good for buying US goods & services or buying US assets


Saudi Arabia would be quite happy to sell some of their oil to China in exchange for those US dollars. So would Iraq, now that Saddam is no longer running things.

Also, don't forget to include US real estate in the list of things which could be purchased with those dollars.
 
2013-03-05 12:37:24 AM

OptionC: In the end, dollars are only good for buying US goods & services or buying US assets


Saudi Arabia would be quite happy to sell some of their oil to China in exchange for those US dollars. So would Iraq, now that Saddam is no longer running things.
 
2013-03-05 01:27:57 AM
GF named my left testicle thundercles: so consumers will have to buy shiat from the US and not from overseas.
~

~
Hey, that rhymes!
 
2013-03-05 02:11:46 AM

Ivo Shandor: OptionC: In the end, dollars are only good for buying US goods & services or buying US assets

Saudi Arabia would be quite happy to sell some of their oil to China in exchange for those US dollars. So would Iraq, now that Saddam is no longer running things.


Ok, so then what do the Saudis do with those dollars besides buy US goods & services or US assets?  All they have done is shifted the issue.

And hey, if foreigners want to buy US real estate, I say go for it - property markets in the US could use a lift.  It worked out great for the Japanese in the 80's, didn't it?
 
2013-03-05 05:43:43 AM
Restricting imports leads to an (exactly equal) restriction of exports. So every time you try and protect your manufacturers from imports you are punishing exporters. Free trade across borders is the answer. Protecting inefficiency and inferior industries at the cost of your efficient industries is not the way to manage the economy.
 
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