China In The Golden Age Of Central Bankers - "Whatever It Takes"

Tyler Durden's picture




 

Submitted by Ben Hunt via Salient Partners' Epsilon Theory blog,

A compassionate man once caught a turtle. He wanted to make it into soup, but unwilling to be accused of taking life, he boiled a pan full of water and, placing a narrow rod over the pan, said to the turtle, “If you can get across the pan, I will set you free.”

The turtle was in no doubt as to the intentions of the man. But he did not want to die. So, summoning up all his will, he accomplished the impossible.

“Well done!” said the man. “Now … please try it again.”

Cheng Shi (12th – 13th century AD)

It doesn’t matter whether the cat is black or white, as long as it catches mice.
Deng Xiaoping (1904 - 1997)

In approaching a problem a Marxist should see the whole as well as the parts. A frog in a well says, “The sky is no bigger than the mouth of the well.”
Mao Zedong (1893 - 1976)

What the caterpillar calls the end, the rest of the world calls a butterfly.
Lao Tzu (604 - 531 BC)

Everything ends badly. Otherwise it wouldn’t end.
Brian Flanagan (Tom Cruise), “Cocktail” (1988)

Jake Gittes:

How much are you worth?

Noah Cross:

I have no idea. How much do you want?

Jake Gittes:

I just want to know what you’re worth. More than 10 million?

Noah Cross:

Oh my, yes!

Jake Gittes:

Why are you doing it? How much better can you eat? What could you buy that you can’t already afford?

Noah Cross:

The future, Mr. Gittes! The future. … You see, Mr. Gittes, most people never have to face the fact that at the right time and the right place, they’re capable of ANYTHING.

Robert Towne, “Chinatown” (1974)


John Huston as Noah Cross, “Chinatown” (1974)

Deng Xiaoping was a survivor. That’s why I love this picture of the man, here 80-something years old, looking for all the world like Emperor Palpatine of Star Wars fame, still dying his hair jet-black and chain-smoking his Panda cigarettes. Purged not once but twice. Wife and daughter dead in childbirth. Friends mowed down by the Kuomintang. Eldest son tortured by Red Guards before being thrown out a 4th-story window. You think this veteran of the Long March, who lived in caves and ate rats … when the war was going well, wasn’t willing to do ANYTHING to set the future course of the modern Chinese State? You think that Tiananmen Square kept this guy up at night?

Deng Xiaoping and his ally/mentor, Zhou Enlai, are the architects of modern China, of China as a Great Power. For 30 years Zhou tempered the Maoist ideology of permanent revolution, preserving the kernel of a stable army and stable government bureaucracy, setting the stage for a pragmatic successor to Mao. But it was Deng who was able to out-maneuver the Gang of Four and seize control of the Army and the Party after Mao’s death (and Zhou’s) in 1976, replacing that Maoist ideology of permanent revolution with a market-driven ideology of modernization and economic growth. Deng wasn’t interested in political purity, but in economic results. It’s not the color of the cat, as he famously said, but its ability to catch mice.

Deng’s political genius – the core attribute that made him such a consummate survivor – was his ability to sell his vision of economic modernization and growth as an end in itself to other political and military leaders. Permanent revolution is … tiring … and doesn’t really pay that well. Deng offered a vision of stability and wealth, and by 1979 that vision proved to be enormously successful in uniting what Clausewitz called the iron triangle of a Great Power – Army, Government, and People, acting as one for a common goal. Economic growth was, to paraphrase “The Big Lebowski”, the rug that tied the whole room together.

Importantly, Deng’s unifying vision of economic growth and modernization was socialist and nationalist in nature, not liberal and individualistic. Deng was no petty oligarch, stashing away billions in foreign bank accounts during his tenure as Paramount Leader, and this was a big part of what made his transformation of the Chinese nation so successful. Deng was authentic. He was a survivor and he was a patriot. He was a Dude, enforcing at the highest levels of the Party and the Army an understanding that economic growth was (primarily) in the service of the nation rather than (primarily) in the service of personal aggrandizement. Sure, there might be the occasional provincial governor egregiously lining his family’s pockets rather than kicking up to the central authorities in Beijing, but this has only been a problem for the Chinese government for … oh, the past 3,000 years or so, and it’s nothing that a few show trials and public executions can’t bring back in line. No, the important thing was that China’s top political and military leaders shared Deng’s vision of market-oriented AND socialist/nationalist ideologies existing hand-in-hand. And for a while there, they did.

Today, however, the Chinese State faces two existential threats, each stemming from or accelerated by the Great Recession and Western policy responses to that crisis of market confidence. 

First, QE and other “emergency” Western monetary policies of the past five years threaten the grand political unification of Deng Xiaoping from without.

Second, massive wealth inequality and concentration driven largely by those same monetary policies threaten it from within.

The external threat to Chinese political stability comes from the explicit purpose of recent monetary policy: to paper over anemic real economic growth with financial asset inflation. It’s a brilliant political solution to the political problem of low growth in the West, because our political stability does not depend on robust real economic growth. So long as we avoid outright negative growth (and even that’s okay so long as it can be explained away by “the weather” or some such rationale) and prop up the financial asset values that in turn support a levered system, we can very slowly grow or inflate our way out of debt. Or not. The debt can hang out there … forever, essentially … so long as there’s no exogenous shock. A low-growth zombie financial system where credit is treated as a government utility is a perfectly stable outcome in the West because our elections and political powers don’t hinge on strong economic growth. They hinge on social issues and notions of identity. They hinge on the preservation of wealth, the preservation of benefits, and the preservation of rights. All good and important things in the Western political context. But for China? Not so much.

Chinese political stability under the unified coalition formed by Deng Xiaoping depends on robust and real domestic economic growth. Not the veneer of economic growth as can be constructed within capital markets. Not the liquidity-driven asset price inflation of Western monetary policy. Chinese political stability depends on the actual production of actual things by actual people working in actual factories, and the prospects for that real economic growth are made significantly worse the longer the West persists in favoring financial asset inflation and the ossification of a low-growth status quo. Why? Because the domestic Chinese market is not advanced or rich enough to support the politically necessary rates of Chinese economic growth. I’m sure it will be one day, but that day is not today. That day will not be with us for decades to come. And until that happy day for China arrives, real economic growth will depend on developed world export markets in the US and Europe. Those export markets are more uncertain and structurally weak from a Chinese perspective than at any point since Deng Xiaoping forged his coalition, and that’s a risk that the Chinese regime will do ANYTHING to redress.

The internal threat to Chinese political stability is even more destabilizing and pernicious than the external threat. I don’t care what you think about the specifics of Thomas Piketty’s book, if you don’t recognize that the growing concentration of global wealth within a tiny set of families is a big problem and getting bigger worldwide, you’re just not paying attention. No country in the world is more vulnerable to the political problems caused by wealth inequality and concentration than China. Why? Because socialism may well be, as Deng said, fully consistent with free market practices on a nationalist, mercantilist level, and it’s mostly consistent (or at least can co-exist) with a free market ideology focused on individual advancement and individual wealth creation in the 99%. But wealth creation and wealth accumulation in an era of massive and coordinated central bank liquidity is a totally different animal than wealth creation and accumulation when Deng consolidated power and struck his grand bargain in the late 1970’s. The unfathomable riches available today to the very top of the economic pyramid – the 1% of the 1% of the 1% – are so enormous that they threaten to obliterate the links that Deng created between Army, Party, and People.

Have there always been rich people and rich families in China? Of course. But the scope and meaning of “rich” is so different today in 2014 than it was in 1984, or 1994, or even 2004 as to be a laughable comparison. It’s not just that concentrated private wealth in the modern manner has created an entire class of hyper-privileged Chinese families with the ability to bypass State control. It’s not just that these hyper-privileged families wield political power independently of any State apparatus.  Most importantly – and most damagingly for Deng’s political coalition – these hyper-privileged families largely arose from personal aggrandizement of positions within the core Chinese political institutions of Party and Army. The meaning of Party and Army has changed in China, from one of unquestioned political legitimacy as THE guardians of Chinese socialism to one of highly questionable legitimacy as a vehicle for personal wealth.  For the majority of Party and Army office holders – those who did not make vast fortunes from their office, those who seek a patriotic return to the unquestioned political legitimacy of these institutions – this is an entirely intolerable development and they will do ANYTHING to change it back. Even among those Party and Army leaders who have managed to acquire great fortunes, there is a widespread recognition that – while the West may be able to accept, even celebrate, unlimited private wealth – China cannot. Not if it wants to remain a politically unified Great Power.

The common thread between the external and internal threats to Deng’s stable political architecture is Western monetary policy and its support of a particular system of global market liberalism. What does China intend to do about it? I believe that Chinese leadership increasingly sees itself as the turtle in the old fable of the turtle and “the compassionate man,” where the system is the pan of boiling water that the compassionate man (the West) sets up to turn the turtle into turtle soup. Through incredible focus and an application of all its resources the turtle walks on a narrow rod to cross the pan of boiling water, but having crossed once is now required to cross again. It’s the system that requires changing from the turtle’s perspective, and I believe that’s exactly what China will seek to do.

Changing the system does not mean withdrawing from the system or blowing the system up. Remember, China MUST continue to sell stuff into developed world export markets as a bridge to a more stable economic growth path based on domestic markets. Changing the system means changing the rules, the “correlation of forces” to use a good-old-fashioned Leninist phrase, so that China can still sell lots of stuff to the world in order to support its domestic factories and generate capital to build its domestic infrastructure, but in a way that can be controlled by the State and not usurped by these hyper-privileged families that have popped up over the past few years. China doesn’t want to be the turtle; it wants to be “the compassionate man” who sets out the pan of boiling water for other turtles to cross. China wants to control its own future, and to accomplish this, strong actions must be taken domestically and internationally.

Domestically, I expect two things.

First, the backlash against the privileged families, particularly those politically active second and third generation inheritors of both a mantle of authority and a vast fortune from Mao-era Party and Army leaders, will widen and grow. This is the right context for understanding the Bo Xilai “scandal” and trial. Murder a British “banker” who helped you quietly funnel more than $100 million into personal overseas accounts? No problem, and thank you for not stealing more. Use your control over a vast domestic fortune (billions of dollars seized from “organized crime” in Chongqing) to fund a personal political machine with national aspirations, in effect becoming a Chinese conflation of Michael Bloomberg and Rudy Giuliani? Sorry, Bub, time for you to go.

Second, and relatedly, the backlash against these Princes will be driven by a domestic media Narrative that China is engaged in an economic “struggle” with powerful outside forces, and that these hyper-privileged families are in effect siding with the enemy. Of course, the Princes can read the newspapers, too. Not only is the message loud and clear that you should keep your domestic wealth hidden and totally segregated from political purposes, but also that you’re only as rich as the wealth you can remove from China entirely. Hold that thought.

Internationally, I expect three things.

First, to construct the domestic Narrative of an economic struggle you need a foreign enemy, but it’s too risky (for now) to cast entire nations in this light. The next best thing? Japanese and American companies that sell expensive, industrially advanced stuff into China, and by “stuff” I mean both manufactured items and services. Recently companies like IBM and Cisco have reported a distinct slowdown in their Chinese business. My view? You ain’t seen nothing yet. As powerful as the “Buy American” marketing slogan has been in this country, the “Buy Chinese” slogan in China will be 100x more powerful.

Second, if there’s one historical lesson that all Great Powers know – particularly up-and-coming Great Powers like Germany in the 1890’s, Japan in the 1930’s, or Russia in the 1950’s – it’s that the only way to win the Great Game is to control enough natural resources so that the incumbent Powers can’t squeeze you dry. Resource independence isn’t a sufficient condition to change the rules of the system, but it’s certainly a necessary one. The resources that matter today are energy and technology, period, and this is the context in which we need to understand China’s actions in the South China Sea, in cyber-security, in Africa, and in its diplomatic relations with Russia. Achieving energy independence and technological parity – or at least reducing its vulnerability to being fatally suffocated if that’s what it comes to – is not a matter of choice to a China that sees itself under assault from the West within and without, but a matter of necessity.

Third, since Western monetary policy is the root of all evil from a Chinese perspective (okay, that’s a bit of poetic license, but not as much as you might think), the primary weaponry for China’s rule-changing efforts will also be monetary policy, particularly currency exchange rate policy. Here’s a chart that illustrates what I mean, and why I think that China is already embarking on the paths outlined above.


For illustrative purposes only. Past performance is not a guarantee.

First, take a look at the price level ratio of the Chinese renminbi and the US dollar (dark blue line above) to see what I mean when I say that the rules of the global trade system pose a structural challenge for China, and that the Chinese government is starting to challenge those rules. From 2005 through 2007 China strengthened the renminbi versus the dollar by more than 20%, assuaging US political pressure that the Chinese currency was too weak and created “an uneven playing field” in international trade. This was an easy concession by the Chinese regime, as domestic growth remained plenty strong and their domestic stock market rocketed higher. Not coincidentally, vast fortunes were built by the most politically connected and powerful Chinese families over this 3-year period. But then 2008 happened, plunging all markets and all economies into chaos. China decided that discretion was the better part of valor during the Great Recession, so the renminbi was kept steady against the dollar until the end of 2009. At this point it looked like domestic GDP growth and global markets were in the clear, and so China returned to the exchange rate policy that had worked so well for them in the 2005-2007 period. Oops. In a QE dominated world … in the Golden Age of the Central Banker … renminbi strengthening has been an unmitigated disaster.

How so? Take a look at the HSCEI/SPX ratio (red line above). Measured from the beginning of 2004, the broad mainland Chinese equity market rose to a price level 2.5x greater than the broad US equity market by March 2009 and the initiation of QE1. Since then, the US market has done nothing but go up and the Chinese market nothing but go down, so that the Chinese market’s price level is now only 50% higher than the US market in 2004 terms, down more than 80% from its peak relative price level.

Similarly, Chinese GDP growth (green line above), after a brief recovery along with the rest of the world in 2009 in response to the Fed’s adrenaline shot straight into the flat-lining heart of US capital markets, has done nothing but drift down in an alarming and totally unprecedented way. I know, I know … Chinese GDP data is terribly untrustworthy and is largely constructed out of whole cloth. But that fact just makes this chart even scarier! If the manufactured data is this steadily disappointing, imagine what the real GDP growth rates look like.

So what is China’s response? Since the beginning of this year, China has forced the renminbi down in value, making the currency weaker and making exports cheaper, in effect administering their own shot of adrenaline to the heart of their economy. I think this is just the start of a multi-year weakening of the renminbi, a sea change in Chinese monetary policy that will inevitably create broad political tensions with the US and make Japan’s devaluation/inflation course infinitely more difficult to achieve. For more than 40 years China has been willing to accept the lead of the US in determining the rules of the road when it comes to international trade. Now China is looking to call the shots. Modern trade wars are not fought with tariffs and quotas, but with exchange rates, and what China is doing with their currency is the modern-day trade regime equivalent of firing on Fort Sumter. 

Okay, Ben … interesting enough, but I’m not a forex trader. What does all this mean for portfolio construction, asset allocation, and risk management?

It means everything. It means that China intends to challenge the current system of global trade by forcing change in the monetary policy rules and relationships we have known for the past 40+ years. It means that ANYTHING is possible and NOTHING is off the table as the Chinese State combats an existential internal and external threat.

To use Mao’s phrase, the Chinese regime is not a frog in a well, seeing the limits of the sky in what the mouth of the well defines. If we want to be effective investors or allocators in the difficult years to come, we need to look beyond the mouth of the well, too. What’s beyond the mouth of the well? What are the specific policy choices China could make to restore political legitimacy to Party and Army while also driving real economic growth? Beyond forcing the renminbi down, staking out energy-rich geographies, “acquiring” technological know-how by any means necessary, and aligning with Russia on all of these issues … I have no idea. But I am certain that there is more to come, in both scale and scope. I am certain that whatever these policy choices may be, they will be outside every macroeconomic model, every sell-side report. I am certain that some historical correlations we treat today as ironclad market laws will be turned on their heads, wreaking havoc on portfolios that insist on treating the past as some immutable Truth with a capital T.

In this environment I think the most useful response from a portfolio construction perspective is to adopt what I call “profound agnosticism” about what the future holds. Or expressed with fewer $10 words, what’s required is to accept that no one has a working crystal ball right now. If ever there was a time when it makes sense to structure a portfolio in an adaptive fashion, where you start with a balanced allocation to a wide range of asset classes and then let the market tell you what’s working and what’s not, today is the day. I’ve said it before and I’ll say it again: the Golden Age of the Central Banker is a time for investment survivors, not investment heroes. China’s challenge to the Western status quo reinforces that claim 10-fold.

I’ll close with an observation of a less defensive sort, because the forthcoming Chinese challenge to the current monetary policy rules will present opportunities as well as dangers, and because a good risk manager is always looking for asymmetric risk/reward ratios in either direction. Here’s a 40-year price chart of 1 US dollar expressed in Hong Kong dollars. The vertical axis (number of $HK = 1 $US) is inverted because a higher number of Hong Kong dollars reflects a weakening of that currency.


For illustrative purposes only. Past performance is not a guarantee of future results.

For the past 30+ years, the HK dollar – the world’s eighth most traded currency – has been pegged to the US dollar with rock-solid certainty. In the world of international trade, the HK dollar hard peg is the equivalent of the law of gravity, with all the certainty for future economic transactions that implies. As you can see clearly from the chart, there has been essentially zero volatility in the exchange rate since October 1983 and the creation of the currency board system.

 To use a geological analogy, the Hong Kong dollar is the most stable tectonic plate in all of global economics, and the fault line between the Hong Kong dollar tectonic plate and the US dollar tectonic plate hasn’t had a tremor in 30 years.  But here’s the thing. The stability of the Hong Kong / US dollar fault line is entirely due to politics. It’s stable because the Hong Kong government says that it’s stable. There is zero reflection of fundamental economic pressures in this exchange rate, because it is entirely a political creation. And if the politics change at a deep enough level, such that it is no longer in Beijing’s interest to maintain the hard peg, you will have a massive earthquake.

Very smart guys have predicted either an end to the hard peg or an end to the Hong Kong dollar altogether, and they’ve been entirely wrong. In 1995 Milton Friedman predicted that the currency could not survive the 1997 handover of Hong Kong to Beijing, a prediction that Jim Rogers has adopted as a policy prescription since 2007. In 2011 Bill Ackman famously went long the Hong Kong dollar, arguing that the fault line between the Hong Kong dollar and the US dollar could not withstand the inflation Hong Kong would be importing from the US (you can access a copy of Ackman’s 150-page slide presentation here). In investments as in comedy, timing is everything. So why do I think it’s different this time? Why do I think the clock is now ticking on an earthquake in the fault line between the Hong Kong dollar and the US dollar?

It’s different this time because China is under greater pressure, both externally and internally, to change the international rules of the road than at any time since Deng forged his domestic political coalition. It’s different this time because there are specific catalysts – the weakening of the renminbi, the creation of a domestic media Narrative that trumpets an economic “struggle” with the West, the claiming of vast swaths of strategic offshore territories, the acceleration of cyber-espionage, the strengthening of ties with Russia to create a new economic axis – that are forcing the Great Powers of the 21st century onto a collision course. It’s different this time because the hyper-privileged families of modern China need to get their wealth out of China ASAP, and parking it in Hong Kong (or in Hong Kong dollars) is no longer safe enough. I can’t tell you the timing, the odds, or the form of this or that earthquake-provoking event. My crystal ball is just as broken as anyone else’s. But I think where Epsilon Theory is useful is in providing the right lens for evaluating these events as they occur, and that this monitoring function can help investors and allocators alike interpret environmental risks as part of an adaptive framework.

4.5
Your rating: None Average: 4.5 (10 votes)
 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Wed, 07/02/2014 - 22:09 | 4920053 Arrowflinger
Arrowflinger's picture

Mocking Hillary here - It takes a PILLAGE.

Wed, 07/02/2014 - 22:25 | 4920094 Bear
Bear's picture

At this point, what difference does it make?

Wed, 07/02/2014 - 23:09 | 4920200 applelover
applelover's picture

His basic premise seems to be that China will weaken the renmibi.  If thats the case, why is zerohedge writing articles daily about how China and Russia are trying to do deals entirely in renmibi? That is the exact opposite of weakning the renmibi.

Wed, 07/02/2014 - 23:22 | 4920238 NoDebt
NoDebt's picture

... but is a necessary precursor to having one's currency become a global alternative/competitor to the dollar.

China MUST get away from the dollar or they will forever be under our thumb.  They don't like being under our thumb.  They hate that they hold so many treasuries (pieces of paper) that they traded REAL goods for.  They're not going to continue making that same mistake.  A muti-currency world is a big negative for the US, but if China can grab "currency market share" from the US in any significant way, it multiples their world leverage.

Wed, 07/02/2014 - 23:49 | 4920313 markmotive
markmotive's picture

China fooled us all.

http://www.planbeconomics.com/2014/05/how-china-fooled-world-documentary...

Debt. Overcapacity. Weak lending standards. Overbuilding.

Thu, 07/03/2014 - 01:00 | 4920428 Bear
Bear's picture

Free market capitalism works ... central planned capitalism, not so much

Thu, 07/03/2014 - 07:43 | 4920854 nixy
nixy's picture

Well ...erm.... if it's central planned capitalism.....it ain't capitalism??

 

Wonder if we could try capitalism some day.

Thu, 07/03/2014 - 03:46 | 4920607 Hugh G Rection
Hugh G Rection's picture

The Asians better learn how to suck on that kosher sausage or they wont be the new 21st century bubble!

http://zionismsucks.com/2014/07/03/beck-vs-obama-who-is-the-bigger-whore...

Thu, 07/03/2014 - 11:08 | 4921502 TBT or not TBT
TBT or not TBT's picture

Fuck China.  

Thu, 07/03/2014 - 00:01 | 4920335 teslaberry
teslaberry's picture

hahah. 

 

if the dollar strengthens , the leveraged system of debt behind the dollar collapse. at that point, after a disaster in the western economies occurs ( hyperinflation ) 

 

TRADE BREAKS DOWN ENTIRELY. which means------china is not trying to 'strenghten' the yuan. china is trying to create a bilateral trading system indpeendnent of the dollar . why ? because when the real 'trade' war breaks out, china's renminbi's strength will help force the u.s. to the negotiating table at the IMF in favor of an international currency that is largely backed by the yuan and gold, this PERMANENTLY HOBBLES THE U.S. MILITARY AND WILL RESULT IN THE U.S. MILITARY PULLING OUT OF MANY MANY MILITARY BASES WORLD WIDE JUST LIKE THE BRITISH AND FRENCH AFTTER BRETTON WOODS. 

THE CHINESE WILL WIN THE WAR WITHOUT FIRING ANY NUKES, AND THEN WHEN IT'S ALL OVER, THEY CAN BEGIN DUMPING THE SHIT OUT OF THEIR PRODUCTS ONTO THE ENTIRE WORLD AGAIN. 

 

 

Thu, 07/03/2014 - 00:29 | 4920377 Marco
Marco's picture

All that matters is what denominations they put in their foreign reserves ... everything else is posturing.

Thu, 07/03/2014 - 01:46 | 4920493 Seer
Seer's picture

"THE CHINESE WILL WIN THE WAR WITHOUT FIRING ANY NUKES, AND THEN WHEN IT'S ALL OVER, THEY CAN BEGIN DUMPING THE SHIT OUT OF THEIR PRODUCTS ONTO THE ENTIRE WORLD AGAIN. "

I realize that this topic is about China, but I believe it's a red herring.  The REAL power is Russia, always has been.  China has been no more than a big growth-based sweat shop.

China will struggle trying to take on the role of world's police.  As they depend heavily on foreign trade this will become more troublesome.  And if you think that the neocon types in the US won't do everything they can to make it ugly...

Everyone except the big energy exporters are basically broke.  Not much of a market out there to dump on, expecially as the credit lines continue to dry up.  And history shows that countries regularly employ tarrifs to push back on dumping: the world saw lower instances of tarrifs because of the global trade agreements- figure that these are going to get tossed into the shit-can as things heat up.

Years back I scoffed at the notion of the BRICS.  I pointed out how they were all, except Russia, fucked in the longer-term.  Look at how things are today.

Thu, 07/03/2014 - 05:58 | 4920749 Tao 4 the Show
Tao 4 the Show's picture

Good points, Seer. Russia supposedly has more nukes than the ROW put together. They are also involved in a long-term strategy to overcome the west, as is very clearly delineated by several Russian defectors over the years. China, it appears, is the swing player - utilizing their standing with both sides, and probably hoping Russia and the west will weaken each other so they can pick up the pieces.

A full analysis of the situation is difficult. China is strong in submarine technology and also have a nearly endless supply of young men who are unable to find wives and are prime candidates for military service. Russia has good tech, lots of nukes, and they are good strategists, but the population dynamics are weak. At the same time, they have managed to sneak communism and social degradation into countries around the world.

We here at ZH and similar sites discuss important issues like currencies, etc., but I suspect that behind closed doors the major players are talking a level of RealPolitik more along the lines of raw power. It is beginning to come out into the open for those who pay attention and will become more obvious moving forward. The Ukraine, Syria/Iraq/Iran, and South China Sea confrontations tell the story.

Thu, 07/03/2014 - 11:18 | 4921530 TBT or not TBT
TBT or not TBT's picture

 China adds value to extracted resources.  Russia merely extracts resources and licks a stamp, then a week later deposits the kleptocrats' giant cut into foreign banks in countries that design and use the things that China makes for them.   Tell me how Russia's space station, enormous nuclear arsenal, and kleptocratic resource extraction regime will save the Russian nation from ineluctable demographic collapse in the wake of the Destruction of its culture under 70 years of insane totalitarian rot. 

Thu, 07/03/2014 - 08:17 | 4920909 ZH Snob
ZH Snob's picture

china is doing the same thing with their fiat as the rest of the world: print it into oblivion before the big reset.  but the big difference is that they have been buying massive amounts of gold with OUR fiat in anticipation of the great reset.

all else is a distraction.

Thu, 07/03/2014 - 11:24 | 4921561 TBT or not TBT
TBT or not TBT's picture

Boy I hope China's billion plus people can survive on a couple of grams of gold a day, after the big reset.   

Wed, 07/02/2014 - 23:14 | 4920213 DoChenRollingBearing
DoChenRollingBearing's picture

 

 

Two responses I have to the article:

1) Our bearing company in Peru just received today a 20' containerload of Chinese "Gen 1 wheel bearings" and "hub & bearings assemblies".  They went on sale today, and word is that they are moving very well.  So we do not feel any price or other pressures re our Chinese products.

2) This article, like many others I have read in the last year or two, tells me that a cool head and intelligent diplomacy (hah!) will keep us out of trouble with China.  We need not fear them.

I will drop by the "BRICs vs. US$" thread now.  IMO, we need not fear all four BRICs either.

Wed, 07/02/2014 - 23:23 | 4920242 lasvegaspersona
lasvegaspersona's picture

Our government is at war with it's citizens and since the Patriot Act has sought to decrease our rights.

It views strong competitors like China and Russia as enemies rather than trading partners.

We are in real trouble as a nation with a government more focused on it's own survival rather than running a great nation.

My dad followed Ike into war. I would not follow Barry (or Bill or George) into a church. We are a nation without a clear policy that is understood by the people. We are lied to daily and our country is weakened for the political gain of the elete.

Wed, 07/02/2014 - 22:32 | 4920110 Spastica Rex
Spastica Rex's picture

Chinese peasants would kick American peasants' ASSES.

Given height/weight handicaps, of course.

Come on Americans - compete to reduce the cost of your labor! Your way of life depends on it!

Wed, 07/02/2014 - 22:35 | 4920119 Bear
Bear's picture

Minimum wage $15 in Seattle, $9 in California ... not so much in Beijing 

Wed, 07/02/2014 - 23:01 | 4920183 Spastica Rex
Spastica Rex's picture

Maybe if we spend more tax dollars on public schooling reform, American peasants will get a clue and learn the error of their entitled ways.

Thu, 07/03/2014 - 06:51 | 4920793 Offthebeach
Offthebeach's picture

You are funny.
we've had over a hundred years of failed reformatting government education. All failed.

Why would you trust your kids mind, Itintellect, life and soul to a entity that can't build a bridge right?

Thu, 07/03/2014 - 11:29 | 4921586 TBT or not TBT
TBT or not TBT's picture

Spastica Rex knows about the public education spending fiasco, methinks.  

Wed, 07/02/2014 - 22:35 | 4920115 Seer
Seer's picture

Chinese political stability depends on the actual production of actual things by actual people working in actual factories, and the prospects for that real economic growth

"stability" "growth"

How do you people differ from the very people that you're complaining about?

As with them, you're also spouting totally illogical crap!

Where the likes of you FAIL:

1) Cannot have "stability" AND "growth" (care to find a doctor who would proclaim that the patient is stable because his/her cancer is growing?);

2) A incomplete "formula"- lacks PHYSICAL feedstock! (you're just creating this nice little equation assuming that the feedstock is there)

Wed, 07/02/2014 - 22:55 | 4920163 stoneworker
stoneworker's picture

Can somebody explain this to me...China buys raw materials builds finished products in factories located in China and then sells these products in America....what does China get from America in return? If it's only green paper that is immediately exchanged into white paper(treasuries) then I really do not see why China needs America....I simply don't may be I am missing something...oil, gas, resources...nope you can get all of that and more from Russia...technology?....Don't they have enough already(what is not made in China)? Do they really care about patent laws or something?...Can they just create Chinese consumers by "giving" money away to the Chinese who can then buy all of those houses and things that would normally be sent overseas...I don't know I am not an eCONomist perhaps brighter people can explain this to me. The article makes it seem as though this is a multi decade struggle...the way I see the house of cards could go down tomorrow if China wished it. I can understand why they want to go slow, but the slower they go the more chance at a Jasmine revolution....As for all of those princes I think they are going to do exactly what the central authorities tell them to do and keep their money in China otherwise we will see a lot more executions...or last minute pardons when all the money is returned. Anyway I know that I know nothing so I hope somebody can point me in the right direciton.

Wed, 07/02/2014 - 23:15 | 4920208 NoDebt
NoDebt's picture

We sure fooled them with all those worthless pieces of paper, didn't we?  Got real goods, gave them paper in return.  They could dump all their Treasuries tomorrow and the Fed would gobble them up with printed money faster than they could sell.  That's what happens when you play somebody else's game at the nation-state level.  

The downside, of course, is that the flow of goods would immediately cease (while inflation would kick in BIGTIME).  Which we couldn't tolerate.  And neither could they.

We've created the global financial equivalent of mutually assured destruction.  Without the framework of detente yet in existance.  We may go to financial war with eachother.  Probably will.  Nobody believed the atomic bomb really existed or worked until we set off a couple to prove the point.  No country currently today really believes they are in a box until they try to get out of it.

 

Wed, 07/02/2014 - 23:21 | 4920235 stoneworker
stoneworker's picture

I agree with everything up to "neither could they"....what could they not tolerate...I mean I am sure they get a lot of joy from sending the US goods but I think they can manage to live without it.

Wed, 07/02/2014 - 23:31 | 4920264 NoDebt
NoDebt's picture

To have trillions of US Treasuries become near-worthless?  Believe me, it would hurt in a LOT of ways.  And they could no longer export in huge quantities of goods to the US since we would be instantly "poor" with a near-worthless currency to pay for those goods.

I can't tell you how this is going to turn out.  Somebody is going to decide it's time for a massive economic war or they won't.  Either way, the power and money will continue to flow west to east.  Just a matter of how quickly.  If they think they can survive the hit and still come out of top, they'll launch the attack.  If they don't, they won't.

In an economic war the threat is not invading troops, it's an internal insurrection.  How much pain they think they can inflict on their own population before they either win the war or are overthrown from within their own ranks.

Wed, 07/02/2014 - 23:42 | 4920293 stoneworker
stoneworker's picture

You have not really answered my question. What is the point of feeding the ponzi scheme?...the treasuries are worthless anyway unless the Chinese deem them worth something...so if it just to fool yourself aka placebo effect yeah I guess that makes sense. What is the point of exporting stuff when you get nothing in return and it is obvious that you never will. What I do see them doing is taking on dollar debt to build housing and other stuff that the Tylers think are a bubble waiting to pop(I don't agree with them). I think the Chinese are going to use all of those "ghost towns" as a hedge against the dollar, so once they rank up enough dollar debt(until they can't get anymore for a reasonable percentage) they will drop their treasuries....hell I will even go one step forward they are a communist nation they can simply make housing free for all of those people that are in rural areas to move to those cities they have built. I understand what you mean about economic warfare it seems obvious to me when it comes to pain the Chinese will win, because they have already shown that they don't mind crushing a bunch of disillusioned students with tanks, whereas the west relys on its image of "peace and democracy" to tax people...if they lose the image they lose the war...Ed Snowden did them a lot of damage.

Thu, 07/03/2014 - 00:01 | 4920332 NoDebt
NoDebt's picture

"the treasuries are worthless anyway unless the Chinese deem them worth something..."

Exactly.  Many parties have the ability to declare the dollar "worthless" or "worth a lot less".  The minute they do, they're taking a hit on anything they have denominated in dollars.  

Don't assume the Chinese people have an infinite pain threshold.  They have their limits like we do.  Tiannamen Square wasn't that long ago.  And they see themselves as an emprire in ascendancy (strong expectation of rising standards of living).  If they take a big step backwards, there WILL be political problems.

So everyone plays the "boiling a frog" game.  Slowly, over time, so the population can adjust.  Not some big, heroic economic calamity in the short term "for the long term good of the nation".  Believe me, when China thinks they can absorb the hit and have a net gain in the end, they WILL take a serious swing at us.  But not yet.  They'll eat us one bite at a time before they go for the jugular.


Thu, 07/03/2014 - 00:08 | 4920347 stoneworker
stoneworker's picture

Right I am with you so far, but my point is why would they take a step backwards...America does not provide the average Chinese worker with anything....it's only the eletes who see zeroes added to their bank accounts, but they know better than anybody else that those zeroes are worth exactly zero. Actually I think we are on the same page, but my question to you is when do you think this is going to happen. The article makes it seem as if it is decades away. I was trying to point out that I think it is much close than that since all the Chinese have to do is create their own consumer which can be done very quickly if there is a will to do it especially in an authoritarian society like China. As I already wrote my guess is they will end the kabuki theater when the US stops loaning them money(they have already virtually stopped loaning money to the US). It makes sense for them to borrow as much as they can and actually buy things of value(not paper gold but real gold) and build things which cannot be done overnight....your thoughts.

Thu, 07/03/2014 - 01:17 | 4920451 Seer
Seer's picture

It's not really about the "average Chinese worker," just as it's not about the "average US worker."  It's about those who are in positions of POWER, it's about Them staying in power: it should be pretty clear now days that folks have to keep the lies going strong to stay atop the heap.

China will never see the likes of the US's Middle Class (especially not in terms of percentages of overall population).  Why?  Because it doesn't have the internal resources.  Consider:

http://www.indexmundi.com/g/g.aspx?c=ch&v=93

http://www.indexmundi.com/g/g.aspx?v=81000&c=ch&l=en

http://www.indexmundi.com/g/g.aspx?v=91000&c=ch&l=en

http://3.bp.blogspot.com/-Ev9f9r9cAF0/T6TOlkNaMEI/AAAAAAAAPHM/U01LVqOSSV...

Nothing can predict the future like energy use, import/export, GDP per capita and demographics.  The trend is always that a country starts with a younger population and as it ramps up exports it steadily increases its imports of energy as its population ages; another country is found to go through this same cycle, leaving this one instance with dwindling exports on top of high levels of imports for energy for which it has built up vast infrastructure with.  Check it out, look up the same info for Japa, for South Korea and for Singapore and the like.  Only those countries that have vast amounts of exportable natural resources tend to hang on.

China is likely already writing off the looming US default.  If it were to acknowledge it outright then it would have massice internal unrest.  They've got to find a way to break the story that they "need" to reduce their growth projections: it was never possible to maintain them, but that's not the story that they'd put forth.  And to acknowldege a reduced growth level will mean that there will be a lot of people caught on the fence line of "poverty" and "middle class," lots of potential anger, focused on their political leaders who we making all the BS promises.

"It makes sense for them to borrow as much as they can and actually buy things of value(not paper gold but real gold) and build things which cannot be done overnight...."

All that was built takes energy to operate and maintain.  There's going to be a shitload of poor people who see lots of of this stuff being maintained as it serves little utility, they're going to be pretty angry.

Thu, 07/03/2014 - 01:50 | 4920505 stoneworker
stoneworker's picture

To stay in power you need to make sure that the other side revolts...to do this you need to improve the standards of living of your citizens and worsen the standards of living of the other side...China is in a perfect position for this. 

"Check it out, look up the same info for Japa, for South Korea and for Singapore and the like.  Only those countries that have vast amounts of exportable natural resources tend to hang on."

Japan imports virtually all of their natural resources they. My guess is the other countries on your list are not doing much better either. 

"All that was built takes energy to operate and maintain.  There's going to be a shitload of poor people who see lots of of this stuff being maintained as it serves little utility, they're going to be pretty angry."

Why not simply give this stuff to the poor people? Here is a suggestion instead of paying the military commanders a high salary you simply provide them with a free house after a certain period of service....listen when you have things of real value you are rich and you can pay the people off to stop them from revolting when you rely on another country for things of real value you are weak and in a very bad position, because even if you bring back jobs the price of things will still skyrocket and you will have a pissed off population even though you may be starting to cure the problem.

Thu, 07/03/2014 - 01:24 | 4920459 IllusionOfChoice
IllusionOfChoice's picture

America is definitely providing an end market for that Chinese factory worker. The Anglo financial markets provide something the Chinese want: cheap gold.

Cheap gold is great for Wall Street since it keeps Oz behind the curtain and it's great for China because it gives them a place to spend those dollars.

If I had to bet on when things break, it would be at the end of cheap gold.

Thu, 07/03/2014 - 01:55 | 4920509 stoneworker
stoneworker's picture

Ok thanks I have heard similar theories before....I accept it as a factor...the question then is why would they have started investing in treasuries in the first place instead of simply buying more and more gold...however I think you may be right they will certainly realize that the jig is up once the west runs out of gold. I do think however that the central bankers are not that stupid and they won't sell them all the gold they have, and will probably increase prices when they feel they need to...that could explain how they could manage to hold up this kabuki theater up until the elections. 

Thu, 07/03/2014 - 07:10 | 4920805 StychoKiller
StychoKiller's picture

As Jim Willie explained, the Chinese take those T-bills and use them to pay for raw materials (in African countries for the most part).  So long as the rest of the World views those T-bills as good collateral, the game will continue.

Thu, 07/03/2014 - 11:55 | 4921687 stoneworker
stoneworker's picture

Right and those countries trade the t bills for Yuans to buy Chinese products....cutting out the middleman only seems logical.

Wed, 07/02/2014 - 23:22 | 4920237 Seer
Seer's picture

I think that you've got a pretty good handle on things.

Volume.

There needs to be an outlet for all that make-work in China.

Just as housing prices could never always rise, growth can never continue forever.  The models are all predicated on perpetual growth.  The US gave China a place to dump the products of its rampant growth.  Obviously, the US ran out of money.  Yes, there's Russia, but Russia is not even close to what the US is when comparing as consumers.  The volume isn't there.  And without exports you cannot IMPORT stuff, stuff like oil and gas (which is key feedstock to the production facilities).

There's really nothing special about China, nothing different with it's politics than most any other country.  All was achieved by suckering a population into chasing the growth mirage.

Wed, 07/02/2014 - 23:31 | 4920263 stoneworker
stoneworker's picture

I did not say that Russia could replace America as the consumer...it can't even though they can increase trade substantially...since both sides have something of value to offer. Why can't the Chinese simply dump the goods into China? You don't always have to export to grow rich. As I said before for now they can get all the resources they need from Russia. Instead of promising people growth just improve their buying power...so what if you don't end up making more things as long as your citizens feel that their living standard is improving there will be no revolution...not through debt, but simply because you don't need green money anymore. From what I know China has basically stopped buying US treasuries...Russia is sellling them. It seems that the wheels are in motion...my guess is they are all waiting for the BRICS bank.

Thu, 07/03/2014 - 01:27 | 4920465 Seer
Seer's picture

"Why can't the Chinese simply dump the goods into China?"

Anything is POSSIBLE.  It's PROBABILITY that I deal in...  And, when you're trying to maintain power over some span of time you have to have something that will hold up for that duration.  I do NOT see product dumping back in to China as being very long-lasting because of the energy equation.

"You don't always have to export to grow rich."

Perhaps not for individuals, but we're talking about nations here, and at that level it IS about trade balances.  Kind of hard to increase internal wealth on a national level without anything from outside...

"As I said before for now they can get all the resources they need from Russia."

And there you have the "outside!"  Where does China come up with the wealth for paying Russia for resources?  USTs?  Ha ha </sarc>  Gold?  Yes, but for how long?

"Instead of promising people growth just improve their buying power."

Feel free to explain how you see this being possible.

Thu, 07/03/2014 - 01:44 | 4920490 stoneworker
stoneworker's picture

" I do NOT see product dumping back in to China as being very long-lasting because of the energy equation."

Please elaborate why does dumping products in China make sense and dumping products in America does? "

"Kind of hard to increase internal wealth on a national level without anything from outside..."

I do not agree with this statement it is not logical the world economy grows despite the fact that there is nobody outside(lets assume aliens do not exists...however now I am suspicious of everything the government claims so who the hell actually knows).

"And there you have the "outside!"  Where does China come up with the wealth for paying Russia for resources?  USTs?  Ha ha </sarc>  Gold?  Yes, but for how long?"

China pays Russia with Rubles/Yuans that are in reality used by the Russians to buy cheap Chinese goods...this is not the outside used to become wealthy this is just due to the fact that China does not have all of these resoures so they must rely on Russia.

Imagine the Yuan strengthens....the purchasing power of the dollar falls relative to the Yuan...now the American consumer is competing with Chinese consumer for all of the goods that would normally be bought by Americans....better living standards for the Chinese worse living standards for the Americans....there are many ways of strengthening the Yuan...you can simply stop trying to print as fast as the fed...but still print so there is inflation(insentive to work). You can back it with something....causing other countries to buy it up(provide goods to Chinese consumer). The point is one way or another the average Chinese citizen needs to all of the sudden get more money in real terms than he used to, so he can buy the goods that other Chinese citizens makes instead of sending the stuff to America which is basically a black hole when it comes to getting something back.

Thu, 07/03/2014 - 02:13 | 4920533 Seer
Seer's picture

"Please elaborate why does dumping products in China make sense and dumping products in America does? "

China was subsidizing the dumping.  Get rid of your competitors and then you rule the market.  But... the market was about the US market, not the Chinese market.  So, the goal of dumping on yourself to rid yourself of competition?

"I do not agree with this statement it is not logical the world economy grows despite the fact that there is nobody outside(lets assume aliens do not exists...however now I am suspicious of everything the government claims so who the hell actually knows)."

The world economy "grows" because we're extracting more and more resources out of it, with energy being the most important resource affecting overall growth.

Our little discussion here is all about trade.  Sure, remove the US markets and let's redirect back in to China.  Again, the equation requires energy, which means that China HAS to import it; this then raises the trade balance issue, and, over a long enough timeframe if you're importing more than exporting it's only a matter of When rather than If you will end up broke.

"China pays Russia with Rubles/Yuans that are in reality used by the Russians to buy cheap Chinese goods...this is not the outside used to become wealthy this is just due to the fact that China does not have all of these resoures so they must rely on Russia."

Could you clarify that second part?  Grammer is a bit awkward.

"The point is one way or another the average Chinese citizen needs to all of the sudden get more money in real terms than he used to, so he can buy the goods that other Chinese citizens makes instead of sending the stuff to America which is basically a black hole when it comes to getting something back."

And that money is going to come from other average Chinese citizens?

Remember, the underlying premise IS growth.  They will, therefore, have to increase wealth from themselves... (and, as I suggest, this is defying historical data points that show countries that continue to increase their imports of energy tend to.... collapse)

Thu, 07/03/2014 - 03:17 | 4920587 stoneworker
stoneworker's picture

"China was subsidizing the dumping.  Get rid of your competitors and then you rule the market.  But... the market was about the US market, not the Chinese market.  So, the goal of dumping on yourself to rid yourself of competition?"

The goal is to create a consumer base in your own country so you are not reliant on foreign consumer. I am not suggesting giving up the US market, but simply let the dollar fall to increase the living standards of their own citizens. Lets imagine that they are keeping the Yuan strictly paid to the usd...usd=x*Yuan...the x is constant...right now instead of giving the money made from exports to their own people they stuff them in US treasuries...what I am suggesting is giving the money to the people that make these things (through increased wages instead of sending the money to the fed), or changing x so that the dollar is worth less now while still increasing the supply of Yuans to avoid deflation...that way the worker's wage which is in Yuans will have more purchasing power than the wage of the pople in the US who make USD...thus you now have Chinese consumers competing with the US consumers...thus the quality of life in China rises and the quality of life in the US falls.

"The world economy "grows" because we're extracting more and more resources out of it, with energy being the most important resource affecting overall growth."

I disagree with you. The most important resource is people, because they work the resources and add value...a computer costs x dollars software can cost xxxxxxxx dollars.  I do not see the problem...they import more oil/resources from Russia other resource exporters and send more stuff to them in return. When you don't have a reserve currency the exchange rate will fluctuate depedning on the trade imbalance.

"Could you clarify that second part?  Grammer is a bit awkward."

You wrote that Russia is the outside that China needs to create wealth...my point is if China had these resources they would not need Russia(Russia does not need China or any country for that matter to survive since they need no resources and they really don't need to import anything...but this is another story). The fact that they need to import stuff from Russia simply means that they need to send a percentage of the products they make to Russia thus increasing the Russian quality of life...it's mutually beneficial.

"And that money is going to come from other average Chinese citizens?

Remember, the underlying premise IS growth.  They will, therefore, have to increase wealth from themselves... (and, as I suggest, this is defying historical data points that show countries that continue to increase their imports of energy tend to.... collapse)"

That money can come from the Chinese citizens if you either figure out a way how to give them money(very cheap credit, increasing salaries...), or you strengthen the Yuan so that a large group of people can afford to buy the goods that they themselves used to make for export.  You don't need growth you just need to improve the quality of life(you don't need a recession either, but fundamentally if the people feel their own situation imporving they are not going to care about some growth statistics...this works vice versa). 

Thu, 07/03/2014 - 03:48 | 4920610 Yen Cross
Yen Cross's picture

  aSS Clown!

Thu, 07/03/2014 - 07:18 | 4920818 StychoKiller
StychoKiller's picture

Hmm, perhaps you believe that the surface of a planet is THE correct place for an expanding technological civilization?  Explain how you reached that conclusion...

Thu, 07/03/2014 - 05:23 | 4920706 Angry Plant
Angry Plant's picture

Dumping the goods in China creates a trade defict as the imported raw material used to make the goods drains resources out of China but the finished goods stay in China.

China should have expanded its internal market years ago but hasnt for the reasons stated in article that being the need to maintain export driven growth.

Thu, 07/03/2014 - 12:03 | 4921720 stoneworker
stoneworker's picture

Trade deficit with who exactly? Simple solution send more products to the producers of raw materials send way less products to the producers of green paper and keep some products home to keep the people happy....forget the export driven growth....you do not need growth(especially when you have to rely for growth on another country's currency) you need improving living standards.

Thu, 07/03/2014 - 01:43 | 4920483 pakled
pakled's picture

One thing too friend stoneworker, not every $ taken in by China gets converted to white piece of paper. As an example, I buy Chinese goods for a small side business directly from the factories (or their in-China's distributors). What happens when I send them a paypal payment for, say, US $1,000? The currency is converted to Yuan (assumedly), which the factory uses to pay its workers, pay their suppliers, pay the light bill, pay their taxes, and direct the rest to R&D, buying more raw materials, or whatever.

Imagine that taking place thousands of times a day. America helps Chinese businesses flourish. Flourishing Chinese businesses create a richer province, and then a richer china. It's commerce.

Then imagine all those thousands of transactions per day stopping suddenly, because China stops financing US debt by buying those white pieces of paper. In a way, it's simply the cost of doing business. It's almost like the house skimming off the top.

Thu, 07/03/2014 - 02:07 | 4920525 stoneworker
stoneworker's picture

Only the top is hundreds of billions of dollars) I understand what you are saying, but nowhere in your scenario do the Chinese need the dollar. I may get the number wrong, but its more like this there is a couple hundred billion dollar trade defecit with China every year....and around 60%(don't quote me I may be wrong all I know is that it's a lot of money) of that is returned to the US via treasury....so basically instead of having inflation which would lead to Americans buying less Chinese goods the inflation is temporarily exported to China, because they agree to hold white papers instead of green papers. This has been going on for so long and with so many other countries that my guess is if right now all the dollars returned to the US mith an m1 supply of 2.5 trillion dollars the inflation would be like 400%....thats just foreign holding....when you factor in the US oligarchs it gets even worse. The model that I believe the Chinese could use to not lose jobs is instead of sending you whatever you buy from them they send it to your Chinese counterpart who is happys since all of the sudden he got more bang for his Yuan. You on the other hand would be screwed since now you need to look for a different supplier or the costs goes up since you have to compete with the Chinese counterpart....basically a nation of producers and consumers that only need to import stuff to countries that provide them with natural resources, and perhaps to other countries that make different(most likely better) quality goods, but so there would not be a huge defecit, but braking basically even....I believe they can do it...I don't see anything that is stopping them.

Thu, 07/03/2014 - 11:49 | 4921665 pakled
pakled's picture

Good questions. I can't think it throught at the moment to give you a good answer. Keep thinking! (not sure why the downvote. not from me). ;>

Do NOT follow this link or you will be banned from the site!