WalStMonky said:Yes, sorry my bad, I forgot that Americans bought the Rockefeller Center back for less than it sold for, and that the new boogey man is the Chinese. I must have been living in the past.who's care? owning a piece of a property in a bad neighborhood, where everybody hate you, isn't much an indeal of an investment.

Does the building represent Rockefeller or his fragmented Standard Oil companies? You people simply do not think and so gullible to propaganda by your true enemies.

workindev said:anakinskywalker said:good points, though I wouldn't quite say that China is self-sustained. I think it's still heavily export-driven and domestic demand is low.

The article raises some points that have not been addressed by anybody:
1. Why are the M3 figures suddenly no longer being published?Because it was a meaningless number that took a lot of resources to publish. It isn't a mystery why they stopped publishing it - they said so in the Press Release: M3 does not appear to convey any additional information about economic activity that is not already embodied in M2 and has not played a role in the monetary policy process for many years. Consequently, the Board judged that the costs of collecting the underlying data and publishing M3 outweigh the benefits.
2. South Korea and some other Asian economies have started slowing down growth in their dollar stockpiles and instead diversifying into Euros. How will this impact the USD's status as global reserve currency? How will it impact the US economy?It won't. Asian economies depend on the value of the dollar. If it drops, it makes it harder for us (the worlds largest economy) to buy their stuff, and it devalues the stockpiles they already have. Any significant change in dollar accumulation policies would be akin to them tying their own noose and slipping it around their own neck.
3. China, Saudi Arabia and other dollar-hoarding countries are starting to use those dollars to buy US companies, instead of simply investing in US Govt. securities like they used to do earlier. They are going from mostly-"loaner" to more-and-more-"owner". How will this impact the US economy going forward?Not significantly. 1) Growth in these markets benefits our economy which sells to them. 2) Demand for US Government securities isn't going away anytime soon. 3) Even if demand for US Government securities does drop, we control the incentive to buy them (I.E. interest rates), so we can always increase demand.

Those who have been pointing out that US Debt is historically at the same levels as percentage of US GDP should note that historically there was no serious competitor to the US Dollar for the position of international reserve currency. Now there is the Euro. Things have changed. So being Number 30 on the list of public debt may not be good enough going forward. The USD has to compete with the Euro to win the confidence of the international finance community. Things are changing; so just keeping in step with historical levels is no guarantor of success going forward. So, the argument that "things are as bad as they historically were, so we'll continue to remain fine" has no merit.I disagree. Nations behind the Euro also hold debt levels similar to the US (some much greater).

And if you think I was saying "things are as bad as they historically were", you completely misinterpreted my comments. I believe things are as good as they always have been. I'm of the opinion that leveraging a growing asset is always a good thing.
Dismissing unpopular items such as this out of hand without due consideration is not going to help us compete and win the challenges of the future.And the challenges of the future aren't going to be "won" by irrational and unwarranted fear-mongering.

Three questions:

1. Do you always believe anything anybody says in a press release?

2. Is it irrational to draw attention to the fact that other economies are starting to lose faith in US Dollar? How long do you think the Dollar will remain international reserve currency if it consistently loses value?

3. Perhaps you are right that the Euro is in no better shape that the US in terms of deficits etc. But the Euro is not the only competition the USD has to face to remain reserve currency. If other economies lose faith in the USD's ability to retain its value, they might prefer to trade in gold. Like they used to do before the US got everybody else to put their trust in the US Dollar. Is it irrational to ask that that trust not be taken for granted?

Anakin

kjl1977 said:
All I see this thread doing is turning into an endless political debate. "your party did this"

It is more than that. For some people, it is a debate of their belief system. Because he is a Republican, the Republican Party can never do anything wrong.

Their lives are defined by the limited boundaries of their belief system. Their lives liberally will collapse if their boundaries are changed. Therefore, there is an incentive for them to lie to themselves that everything stays the same. You will hear them parrot slogans such as "America #1" regardless of subject matter and context, because their belief system does not allow them to evaluate facts objectively.

The conclusion is predetermined. The only course of action is to "stay the course." Usually, they will elect leaders because he or she "stay the course" regardless of circumstances. This makes them feel better about themselves.

sweetbutter said:I do not understand why all the bashing on the Japanese corporations happen lately. Sure the US economy is not as "good" as 2 years ago, but is it all the Japanese faults? Please take alot at the trade deficit, Japan still rank third as US trade partner, or second, please look. When you are talking about the economy please use macro economic instead of personal finance, and your belove microeconomic.
And beside it is a corporation, meaning the Japanese do not own all of their companies. There are alot of US investors who legally are the owners of these corporations as well. They are simply invest in what work, just the same as the consumer who purchase what is best for their dollars.
This ignorant must stop! I think you guys are anti-Japanese. They were born Japanese, did they ask for it? is it their fault if their ancestor were ambitious?
For example: Sony CEO is no longer Japanese, Toyota and Honda have to built plants in the US because they do not want to endure anti Japanese hatred, Japan government have to give tax incentives to US corporations so their products can be competitive in the Japanese market.
The truth is, the Japanese spend alot of efforts and energy to develop great products and maintaince their credibility after WWII. The evidences after so call 30 years have paid off, globally, not only the US.
This bashing on the Japanese effort in the free market is sort of a scape goat scheme. Why don't you blame China? or all of the US so called patriotic corporations who are shipping all of your jobs and equipments elsewhere. Yes, they just use your patriotic sense into buying continue crap designed products but no longer made in the USA.
I'm not Japanese, but just tired of this misinformation.

I think you are over-reacting. Nobody is bashing the Japanese here.

Personally I think the Japanese are a great people: hard-working, and sharing our values of democracy, freedom, liberty, and free market economics.

Of course, China or Saudi Arabia are a different matter altogether.

Anakin

workindev said:AlwaysWrite said:Funny how most of the FWF forums are dedicated to teaching people to get out of debt, live within your means, don't spend more than you have, don't rely on credit cards and making interest payments, etc., etc. But when it's Uncle Sam doing it, every single responsible, prudent piece of investment advice gets turned upside down. Sure, keep spending more than you take in, keep borrowing more and more and more money, to the point that just the INTEREST you're paying is your second-largest budget item (just below your mortgage, and more than your car payment, for example).

It's amazing how people can be so inconsistent.It's amazing how you are, either unintentionally or not, missing the whole picture. There is absolutely no comparison between personal debt and macroeconomics or deficit financing. When you are financing a growing asset, you definitely can keep borrowing more and more money. Don't believe me? Just ask the CFO of every Fortune 500 company (except for 1) why they keep issuing bonds to investors (in other words, why they keep borrowing more and more money). Just ask the treasury department of every industrialized nation why they issue debt vehicles to private investors. Just ask some of the AOR champions on this board why they are willing to take out massive amounts of low-cost debt to buy growing investments and savings vehicles. Ask the British government why, for the past 300 years, they have issued perpetual debt securities called Consols that have no maturation date, and why investors buy them even though their principle never gets paid off?

Deficit financing helps the government to fund important, growth promoting projects, infrastructure, and security that helps our economy grow, which in turn helps make the debt easier to service. In fact, interest payments are the smallest they have been in 10 years in relation to the size of the economy, and are almost 4% lower than the so-called "glory days" of 1999 when deficits were essentially eliminated.
And why does Uncle Sam do this? NOT because it's better for our long-term health. Because Presidents are elected for 4 or max 8 years, and paying it back is SOMEONE ELSE'S PROBLEM - and the "someone else" is you and me. Why would they do unpopular things like raise taxes or reduce spending? Just borrow some more, it won't collapse right away, we have a few years left before we have to pay the piper. If you had the same deal, you'd buy a Ferrari too, and let someone else worry about paying it back.You simply don't understand. We are continually paying back debt, and we are continually issuing new debt. We "pay the piper" every day when some invstor's decade-old T-bill matures and they turn it in, or buy a new one. We have been doing this for 150+ years because it is better for our long-term economic health. There isn't some scary, magical day in the future when all government debt will suddenly have to be paid off all at once. If this is a problem for you, mitigate it by purchasing some of these debt securities yourself. That way, the taxes that you pay that service the interest on debt will come right back to you.What people need to realize is that savers like us essentially get taxed by the government. They are taking your money, every month, every year, and 99.5% of people don't know it. That $100,000 you worked so hard to save will only be worth $90,000 next year, and $80,000 the next, and so on - the US Dollar has lost 96% of its value since 1913 (the creation of the Federal Reserve system) - that's pretty close to being totally devalued. How? They print more money for themselves, and therefore your money is worth less - supply and demand, because you have more dollars chasing the same amount of "stuff" like land, food, gold, etc. But as long as the numbers in your bank account aren't going down, people don't realize what's happening. Just imagine if the gov't levied a 10% flat tax on all your savings every year - in addition to everything it already takes. There'd be a revolution, and rightfully so.You don't understand the concept of growth. We aren't chasing the same "stuff" - we are continually producing new "stuff". This isn't a zero-sum game. Every dollar that is earned is not taken away from somebody else. When you have a growing economy, you are in fact creating something out of nothing.

You are missing his point. His point about inflation being an invisible tax is correct. Are you claiming otherwise?

One requirement for a monetary currency is the ability to retain value over time. The US Dollar has not been doing it too well for several decades now and a lot of people are losing patience.

Anakin

Two things can happen in the short term that can help restore international confidence in the US Dollar:

1. US will develop some fantastic new technology (drastically more efficient car, perhaps?) that will dramatically improve the US balance of payments and speed-up GDP growth.

2. US investment in Iraq will pay rich dividends.

Anakin

agentpt5 said:I see that all the xenophobic morons are out in full force on this thread. I don't think I need to add anything. Republicans and their fascist polices have damaged America forever. Buy gold. Inflation will continue.

I would like to respond to this racist comment with a slightly OT clarification of the modern liberally promoted lexicon:

xenophobe (noun) - typically a white male US citizen who fails to demonstrate an appropriate level of self-loathing or hatred for the USA as defined by anyone who is not a white male or a US citizen or simply one who hates either or both.

Back on topic, there are many investment opportunities that are less susceptible to a falling US dollar, but I'm not done buying them so I'll have to keep them to myself.

agentpt5 said:alchemize said:agentpt5 said:I see that all the xenophobic morons are out in full force on this thread. I don't think I need to add anything. Republicans and their fascist polices have damaged America forever. Buy gold. Inflation will continue.One red because I can only give one. Take it to democratic underground or somewhere that wants to hear your politics. Last time I checked, the "Democrats and their communist polices <sic>" helped create social security and medicare/medicaid, of which the unfunded debt potential is staggering. 10 trillion for SS and 38 trillion for Medicare.

See, another Republican get very angry because his belief system is being challenged. Time to name call and shit on the speaker, so he can feel better about himself.

I suggest readers of this thread read up on the subject of psychology. It will help your tradings and investments.

You've been reading too many blogs, there is no anger in the comment to which you respond. You sound as though you are angry that you are unable to silence the opinions which you do not share.

There are appropriate places where you can be with a monolith of those such as yourself and spout your nonsense, unchallenged, until your fingers bleed. Please go there now.

delzy said:agentpt5 said:You sound as though you are angry that you are unable to silence the opinions which you do not share.



Not at all. Who cares about your nonsense anyway? There is no need to silence anything. Liberals love free speech. We are not Republicans.



There are appropriate places where you can be with a monolith of those such as yourself and spout your nonsense, unchallenged, until your fingers bleed. Please go there now.

Will you join me there?</blockquote>

agentpt5 said:
Not at all. Who cares about your nonsense anyway? There is no need to silence anything. Liberals love free speech. We are not Republicans.



Liberals only love free speech if it fits in with thier agenda.