China and Japan account for 47% of money lent to the United States of America mainly in the form of treasury notes or bonds. They do this for a number of reasons ,firstly so the USA has the money to spend on consumer goods they produce. Secondly to keep the US dollar strong compared to their currencies so their products are very competitive when compared to any thing made in America.
It is my belief they have done it to such an extent to put their competitors out of business in the US and other developed countries in the view that once these industries have been crippled they can allow the dollar to fall as the USA will no longer have the infrastructure to compete. It is like a casino lending addicted players half of what they gamble and then letting the debt ride.
Now i have worked for the Burswood casino in Perth as a driver in the past and from what i could tell from talking to these high rollers the casino's like the Asian nations are quite obliging until the new money runs out. The Asian nations have been much more hospitable than a casino would be but they have much more to gain which is a subservient society addicted to consumer goods. I was wondering what the Asia society was going to do with all these US securities until a major Japanese corporation bought a 20% stake in one of Americas largest banks. Then i realised they intend on buying up their Western competitors at a discount prices as the stock markets fall.
The thing is if Americans are dumb enough to elect George Bush as president they are well and truly dumb enough not to see this coming.
Wait there is more the USA is also subjugated by the cheap Arab oil and Iran now knowing it is only a matter of time before the US dollar is worthless has demanded that their oil be paid for in Euros . It is only when not if that the US dollar is no longer the international reserve currency .
Even though The USA consumes one third of world production and is 25% of the world economy ,who says it has to stay that way . There is a huge middle class in Asia that have been saving rather than spending via personnel and imposed superannuation schemes that have shown a more sophisticated consumer consumption increase . Real wealth is in the countries that produce new goods and services not inflate existing assets by printing money. I mean what would you personally prefer to take home a big screen tv ,car,etc or a pile of monopoly money.
Even with an 800 billion dollar bailout of the bad bank debts carried by poor bank lenders world wide will not redeem the underlying problem of US gluttony . The only real answer is to stop importing expensive energy and pay the real price of renewable local energy.
The amount invested in the US commercial paper market fell by $95bn during the past week, increasing concerns about the availability of money for banks and companies from this vital source of short-term funding.Data released by the US Federal Reserve showed the amount invested had its biggest weekly drop since the central bank began tracking the sector in 2001.In the past three weeks, the Fed data have shown that more than $200bn has been taken out of CP, a type of short-term debt that was widely bought by money market funds.Of the $95bn weekly drop to $1,600bn, financial paper accounted for most of the decline, falling $65bn.
If you had purchased $1,000.00 of Delta Air Lines stock one year ago you would have $49.00 left.With Enron stock, you would have had $16.50 left of the original $1,000.00.With WorldCom stock, you would have had less than $5.00 left.But, if you had purchased $1,000.00 worth of beer, one year ago, drank all of the beer, then turned in the cans for the aluminium recycling REFUND, you would have had $214.00.
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