China Fires Back At US Senate Which May Have Just Started The Sino-US Currency Wars

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Mon, 10/03/2011 - 21:58 | 1735533 Barb Dwire
Barb Dwire's picture

Wow. Incompetence at a new, unthinkable level. Bravo.

Mon, 10/03/2011 - 22:15 | 1735600 LetThemEatRand
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Yeah, because free trade with cheap labor/no environmental law countries like China has worked out so well for the American middle-class.    If it's not broken, don't fix it, right?

Mon, 10/03/2011 - 22:21 | 1735621 Spitzer
Spitzer's picture

Yeah, because free trade with cheap labor

Japan and Germany have higher wages then the US yet they have trade surpluses with China. Germany also has no minimum wage laws.

http://freegoldobserver.blogspot.com/

Mon, 10/03/2011 - 22:28 | 1735640 trav7777
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Germany is UNABASHEDLY protectionist and mercantilist just like China and Japan. 

China's trade policy has been predatory and mercantilist.  They have pegged to the dollar and such a thing should be impermissible.

Mon, 10/03/2011 - 23:37 | 1735869 Cynical Sidney
Cynical Sidney's picture

this currency war with china is about whose worthless fiat currency gets to have reserve status in the world.

ps chinese mining operations are running some crazy scams, they can't be the biggest gold producer in the world the figures don't make sense at all, people look into it!

Tue, 10/04/2011 - 01:19 | 1736097 Mr Lennon Hendrix
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China is the better fascist whore. 

Can we change the channel?  I am sick of this show.

Tue, 10/04/2011 - 03:31 | 1736220 Mauibrad
Mauibrad's picture

Trade War, Bitchez!

Tue, 10/04/2011 - 06:55 | 1736336 Zeilschip
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As long as Chinese firms are blocked from taking over American firms they're not going to let the peg go. Why would they.

Tue, 10/04/2011 - 01:18 | 1736094 Mr Lennon Hendrix
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The US has welcomed the peg until now (circa 2009).  It is juvinille for the US to act like it has not been this way.  The US will get what it wants; China will depeg; and in a flash of light China wil become the new defacto fascist America, taking everything away from America at once- "Danzig with the Starz", everything.  Americans will learn what it means to do hard labor again.  Why?  Because America has no oil, and no industry.  America does have gold...until Paul audits it.

Tue, 10/04/2011 - 02:48 | 1736187 dolly madison
dolly madison's picture

I have already switched to the hard labor myself, and I am quite happy this way.  I've been doing small farming and cooking all our food from scratch.  It started with having to cook from scratch because my daughter had so many food allergies, but after only months of going off of the pre-made foods, my daughters allergies were all gone, and we all felt much better.  There was no going back.  The small farming came as I prepared for the possible collapse, and it is good to fight inflation anyway.

When I sat behind a steering wheel or a computer all day, and ate lots of ready to eat food, I felt a whole lot worse than I feel now that I am busy doing work that requires me to move all day. 

I really do want solar panels though.  I would hate to lose refrigeration and laundry machines if it really does eventually collapse.

People lived without automation longer than they lived with it.  We will find other ways if we need to.

Tue, 10/04/2011 - 06:00 | 1736296 fiftybagger
fiftybagger's picture

Good for you!

 

 

Silver For The People

http://www.youtube.com/user/BrotherJohnF?feature=mhee

Tue, 10/04/2011 - 21:29 | 1739788 Nobody special
Nobody special's picture

Google clay pot refrigeration.  If you have $20 for two pots, a bit of sand and a towel, you have a refrigerator... and a damn good one at that!  One that works without electricity.

Tue, 10/04/2011 - 18:47 | 1739382 BigJim
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...Why?  Because America has no oil...

Though I agree with you generally, LH, you're wrong on this point.

If countries A, B, and C produce oil, but demand payment in a currency created 'at essentially no cost' by country D... who really owns that oil? Countries A,B and C, or country D? Particularly if the 'leaders' of countries A,B and C are widely-disliked despots and rely on country D's military to keep them in power?

Tue, 10/04/2011 - 04:49 | 1736258 rufusbird
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Saudi Arabia has pegged the value of the riyal at 3.75 to the dollar since January2003. Nobody is complaining.

 

 

Wed, 10/05/2011 - 15:52 | 1742520 TravsMom
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You have really grown up to be an amazing daughter!

Mon, 10/03/2011 - 22:30 | 1735644 LetThemEatRand
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Germany is actually quite protectionist and has a completely different monetary policy than the U.S.  They don't reward bankers for lending money to people who can't pay it back so that bank CEOs can keep their Bentleys to the current model year, for example.   http://seekingalpha.com/article/212461-what-the-u-s-can-learn-from-germany-about-managing-its-trade-deficit

Mon, 10/03/2011 - 22:41 | 1735683 Mister Neutron
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<==== This is good for gold?

<==== This is bad for gold?

Mon, 10/03/2011 - 23:08 | 1735769 Gadfly
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In 1940 the U.S. placed an embargo on Japan by prohibiting exports of steel, scrap iron, and aviation fuel to Japan.  In 1941 the U.S. froze Japanese assets.  In December 1941, the Japanese bombed Pearl Harbor.  Our idiot politicians insist on making sure history repeats itself.  Real vision and leadership.  They're leading us right off the fucking cliff... again. 

Mon, 10/03/2011 - 23:26 | 1735830 LetThemEatRand
LetThemEatRand's picture

That doesn't even make sense.  

Mon, 10/03/2011 - 23:30 | 1735844 tmosley
tmosley's picture

Clearly you are not a student of history.  If goods don't cross borders, troops will.

Not sure how applicable that is in a nuclear armed world, though.  God help us all if it is.

Mon, 10/03/2011 - 23:33 | 1735856 White.Star.Line
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Edward Abbey said that nuclear arms made war no fun anymore.

He also believed that those that used firearms were just cowards truly afraid to fight. In the case of nukes, the ultimate cowards are the countries that own them.

Tue, 10/04/2011 - 01:29 | 1736116 Mr Lennon Hendrix
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No one will use nukes.  It will render the dollar worthless overnight.  The dollar only has worth as long as the US military is capible of ruling the world.  Nukes mean everyone has the ability to fight.  As long as no one uses nukes, the US can man handle the rest, until oil supply becomes an issue, then the US is dead in the water.  The world is waiting for oil to only trickle into the US, because then they can depeg.

Tue, 10/04/2011 - 03:01 | 1736188 GoinFawr
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++

Mon, 10/03/2011 - 23:52 | 1735917 LetThemEatRand
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No, I'm not a student but I did study history.   Are you seriously suggesting that if we try to impose any kind of trade barrier that fucking China is going to invade the US?  Is that what you're studying in school?  

Tue, 10/04/2011 - 00:00 | 1735931 Storch
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China can only peg their currency by buying huge amounts of treasuries w their excess dollars, so it is a mutually parasitic relationship.

http://www.khanacademy.org/video/pegging-the-yuan?playlist=Currency

Yuan appreciation would mean higher rates on our 15 tril nat debt. So we are bluffing.

Tue, 10/04/2011 - 00:15 | 1735951 LetThemEatRand
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Probably true, which is the sad part.  We have become subjugated to China, which is a Communist/authoritarian regime that has crushed our middle class by [temporarily] enriching some of the greedier members of our society.  Despite the long-term damage of this economic model, endless numbers of mindless Shills who have their one "free trade" gear, violently oppose changing the current paradigm.

Tue, 10/04/2011 - 00:27 | 1735991 tickhound
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Rand, regarding your "makes no sense" comment...

Its important to note,

 If a nation were to place an embargo on the United States prohibiting vital exports and/or freeze U.S. assets, we would consider it an act of war.

Tue, 10/04/2011 - 00:35 | 1736015 LetThemEatRand
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"if a natiion were to place an embargo ... prohibiting vital exports and/or freeze U.S. assets, we would consider it an act of war."

Yes, and if we were to kill Putin Russia would be pissed, and if we were to declare war on Mexico....  I don't think a trade embargo or freezing of assets are part of the Bill at issue in this story.  But nice straw man.  

Tue, 10/04/2011 - 01:11 | 1736076 tickhound
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Modern warfare takes many forms.  Gadfly gives these initial salvos some historical perspective.  It doesn't have to happen that way, and it probably won't... But his brief description of events certainly "made sense"

And by straw man you suggest that I am misrepresentating your makes no sense position.  I simply reversed Gadfly's historical record, and re-tested your position.  Apparently it "made no sense" the first time, and became a straw man the second. 

If anything is straw man, its you representing my position with "if we were to kill Putin..."

Some people come into zh a bit too sensitive.  It'll wear off.

Wonder how real Rand feels 'bout all this?  I know he hates embargo...

Tue, 10/04/2011 - 19:27 | 1739498 Helix6
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Re: "China can only peg their currency by buying huge amounts of treasuries w their excess dollars, so it is a mutually parasitic relationship."

Of course the missing link in this argument is the question of how those dollars ended up in China's Central Bank.  After all, Chinese exporters want to convert those dollars to Yuan in order to conduct their businesses.  Gee, I wonder where all those Yuan to soak up all those "excess dollars" came from?

China can bleat all it wants about "illegal trade practices."  They should know.  They've been engaging in every last one of them for two decades now.  The US should have taken this step twenty years ago. 

Tue, 10/04/2011 - 00:06 | 1735950 Skid Marks
Skid Marks's picture

don't get worked up cause this will get worked out. It is as the China man said, political BS. One thing is for sure, anytime the word "Reform" appears in the title of legislation it means the American People are going to really get screwed.

Tue, 10/04/2011 - 02:56 | 1736192 A Nanny Moose
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It is entirely possible that the great battles of the next war will be won without a single shot being fired.

Stuxnet bitchez!

 

Tue, 10/04/2011 - 05:35 | 1736281 Element
Element's picture

A little something to cheer you all up.

 

You Will Survive Doomsday

http://www.aussurvivalist.com/nuclear/doomsday.htm

Tue, 10/04/2011 - 03:02 | 1736194 A Nanny Moose
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I am not as worried about  nukes, as I am about compromised computers and the socially engineered users using them.

Mon, 10/03/2011 - 23:31 | 1735851 JW n FL
JW n FL's picture

 

 

LetThemEatRand

That doesn't even make sense.
This from someone blaming a dead chick for all the problems of the World? The Lobby? nope! no problem there! Corruption? nope! no problem there! it is that crazy dead bitch! it is all her fault! we need some German / Austrian math to fix the problem! becuase the only problem is those there damn mex-a-cans and niggers on welfare (although more white people are on welfare! stupid fuck!) How about you and your sister / wife go move to africa and enjoy the austerity and non-government intervention!
Mon, 10/03/2011 - 23:50 | 1735908 LetThemEatRand
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Wow.  I truly have no idea what you are talking about.  I suspect you don't either.   I don't blame a dead chick for all the problems in the world.   I just think people that follow her are fucking idiots.

Tue, 10/04/2011 - 01:58 | 1736147 Hacksaw
Hacksaw's picture

NT

 

 

Mon, 10/03/2011 - 23:50 | 1735910 Cynical Sidney
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the embargo was in response to japan's militaristic ventures eg. invasion of manchuria, assassination of china's de facto leader, vivisection of PoW's etc.

Tue, 10/04/2011 - 03:14 | 1736208 Seer
Seer's picture

One has to wonder whether this is really the case: esp given that Japan had been mucking about since 1933.

I'd more or less come to the belief that this had been a plan to bring the US into WWII.  From http://www.lewrockwell.com/prather/prather22.html

Now that you know that the Japanese attack was more or less provoked, there are a couple of things about World War II that might make more sense to you. For example, you may have read in Stephen Ambrose's wonderful biography of Ike, where General Marshall – the U.S. Army Chief of Staff in 1941 – called Eisenhower (who temporarily had been promoted to Colonel in March 1941 and to Brigadier General in September 1941) to the Pentagon immediately after the Japanese attack and charged him with war planning. Eisenhower, who had spent years as aide-de-camp to General MacArthur – the commanding general in the Philippines in the late 1930s and early 1940s – naturally assumed that he was to plan a counterattack in the Pacific against the Japanese, who had attacked us. No, no, said General Marshall. Put the Pacific war on the back burner, he said. Our first priority is to defeat Hitler.

You see, four days after the Japanese attack – which apparently came as a complete surprise to him – Hitler declared war on the United States! Absolutely incredible that Hitler would have done such a thing! Many historians believe that if Hitler had not done that, Roosevelt might never have persuaded Congress to declare war on Germany. After all, it was the Japanese who had attacked us. Hitler hadn't. On the other hand, the vile dictator Hitler had attacked the vile dictator Stalin. The Third Reich vs. the Soviet Union should have been – to us – like the Iran-Iraq war, where some unnamed high-level administration official opined that it was too bad that one side or the other would have to win the war.

Therefore, immediately after the Japanese attack on U.S. forces in the Philippines and at Pearl Harbor, in late December of 1941 and early January of 1942, Winston Churchill and President Roosevelt met in Washington, D.C., with their military chiefs in attendance. Roosevelt and Churchill agreed at that time to set up a U.S.-British combined chiefs of staff and recommitted themselves to the defeat of Germany as their first priority.

Tue, 10/04/2011 - 06:37 | 1736284 Cynical Sidney
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the japanese would argue rapid western colonial expansionism poisoned the waters of international trade; japan was just following the lead using a wickedly direct approach. japan simply wanted to keep growing their economy and their gdp in an tiny mountainous island, scarce of resources, located off the vast lands of eurasia overlooking china and russia.  I guess china's in a similar situation these days. treacherous trading wars, real or perceived, put them in a disadvantaged position.

My take is that there must have been some sort of pact between adolf and japan to divide up north america, however as they find their lines run thin against increasing resistance, at some point adolf realized that his advances had had used up all momentum as repeated pushes became stalled. he then chose to hasten the demise of his own people and the slavs. most slavs died nameless unlike jewish victims whose identities were compiled into records by their executioners. but for every 1 jewish victim there were 2 slavs who died. the mystery is why would the jewish WWI vet adolf want to eliminate his own race? my guess is when the weimar economy collapsed, jewish people as a group had had loads of exposure to financial crisis then, adolf was probably left high and dry by contemporaries of blankfein, rubin, fuld, conman bernie and chairman bernanke, therefore adolf set out to outdo his own people. I believe there are relevant documents and information sealed away by the government. we need to open the vaults and let the truth out.l

Tue, 10/04/2011 - 06:46 | 1736326 Snidley Whipsnae
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CS... Take a closer look at the economic history of WW1 in order to understand why Hitler hated the Jews in particular.

Hitler, and many German WW1 vets and civilians, blamed the Jews for the movement toward socialism/communism in Germany during WW1. To the Nazis there was no line between Jews and communism.

As German civilians became increasingly hungry, they were bombarded with anti war propaganda at home and this news reaced the front lines, causing disunity among the soldiers.

I'm not saying this is what happened. I'm saying this is what the Nazis thought.

If you have the time you should read Shirer's 'The Rise and Fall of the Third Reich'... Shirer was in Berlin, as a correspondent, for much of WW2. He reported what he saw at consular gatherings, German newspapers, etc. A first hand, on the scene account of events... Doesn't get much better than that.

BTW, The day that Germany invaded Russia there were still RR trains loaded with commodities heading into Germany from Russia... Stalin was truly shocked and went into seclusion for three days. Since this is a discussion of trade I thought I would throw in that little tid bit.

Tue, 10/04/2011 - 08:18 | 1736409 Cynical Sidney
Cynical Sidney's picture

thank you for suggesting the book i read it sometime ago; and the bit about stalin is common knowledge. germans blame the jewish people for lots of things during ww1. concerning communism note that bolshevik movement in russia was created by remnants of german's defeated military's spy network, in perhaps the last act of the german empire, with the aim of destabilizing a powerful enemy next door. ruling germans in the old empire knew that communism is least efficient and produces nothing of worth.

ps. i know what the germans thought, i want to know what adolf thought, why a jew want to wipe out his own kind. speaking of which, i think communism may better suit jewish financial criminals who likes to game the system and exploit loopholes

Tue, 10/04/2011 - 02:53 | 1736189 A Nanny Moose
A Nanny Moose's picture

When goods do not cross borders, troops do.

Tue, 10/04/2011 - 02:54 | 1736191 dolly madison
dolly madison's picture

That was us not selling them stuff and freezing their assets.  Nobody is proposing to do that to China.  We will gladly sell them stuff.  We are talking about not buying so much of their stuff this time.

I will be very surprised if this passes though.  It is probably just a show for the voters.  Charging tariffs on Chinese goods would take money from the pockets of many of the corporations that run the US.  The US government would just not be a very good puppet government if they did that.

Tue, 10/04/2011 - 03:24 | 1736215 Seer
Seer's picture

Don't underestimate (or ignore history) how desperate US leaders have become.  The US empire is starting its collapse phase.  Domestic unrest represents a far greater danger to power than are external threats/unrest.  US leaders WILL pursue the hobgoblin approach (which it has been polishing via the "fighting terrorism" campaign).  Besides, it's all-so human nature to point to others for one's own failings.

The pegging/not-pegging issue is STUPID.  If the US's balance sheet was strong enough it would handle any challenge.

Thu, 10/06/2011 - 11:57 | 1746009 TeresaE
TeresaE's picture

Dolly, it won't "take" a dime from the corporations.

Just like the child's lead law, and rubber tarriff, it will ENRICH the corporations.

The only people that "pay" in America, are us little guys.

This will increase costs on US, just as our paychecks are shrinking again - and leading up to the great big shrink that starts next year (Obamacare) - Congress will "help" us by making everything more expensive.

You have (partially) figured it out.  Our food is crap and making us sick.  Our medicines are crap and killing us.  A life of inactivity and bad food will reduce the increase in life expectancy that clean water brought us.

Doing this now guarantees that millions of our nations poorest citizens cannot afford things like aspirin, insulin and Mott's Apple Juice or ANY Walmart branded food.

There are THOUSANDS of products that are no longer made HERE.  Products we need and use everyday.

This bullshit "fairness" crap is being pushed to make sure more of us end up poor, while CONgress and their corporate buddies will have record income years next year, and blame their financial success on "China" retailiation.

Mark my words, IF this passes, it will start to become obvious how little we have left going for us.

Mon, 10/03/2011 - 22:34 | 1735661 DaBernank
DaBernank's picture

China buys *quality* products from Germany & Japan. GM would have to build automobiles to compete with BMW and Mercedes in quality & style. Caterpillar sells units to China. I've thought for quite some time that this trade imbalance is about a paucity of quality manufacturing in the US than anything else.

Mon, 10/03/2011 - 23:12 | 1735776 quintago
quintago's picture

This isn't a trade war, this is a game of "whose ship is going to sink first". China's soft landing just became a nose dive. The uncertainty alone will slow production and investment in China.

Mon, 10/03/2011 - 23:49 | 1735905 Kiwi Pete
Kiwi Pete's picture

The US does produce other top end quality stuff too. One of our hospital boards just purchased an MRI unit from the US for a couple of $mil. Haven't heard of China selling too many of them.

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