21–27 of 27 posts
We're going to be explaining to school children how every sovereign entity in the world can be in crippling debt simultaneously for centuries. Here's hoping those next societies actually learn something from this. With a bit of luck and a whole lot of making hard choices, perhaps ours will be one of them.
Earlier quoted context omitted.
I would have felt calmer if that assuring voice wasn't the third comment from a month old account. :-) Anyone really know ?
We _know_ that the UK, and while it isn't within my direct sphere of knoweldge, it seems common knoweldge the US too are in a fairly dire financial situation, though their AAA credit rating and various other orchestrated advantages cover that for them (oil bought in Dollars for example). Also we can see that plenty of other countries that don't have similar advantages are closer to real trouble (Greece being propped…
The question at hand is essentially: What is the truth about China? I am not sure why you are bringing up US and UK finances and itching to make the comparison.
Sure, making China look bad might further interests in the west, but it says nothing as to the article's accuracy. It is good to note that the article may be biased against China, but I think the focus should be on the facts and analysis provided.
> What exactly is there to find calming about this smoke-screen information?
I don't think berntb was saying the article made him feel calm -- I think he was calling into question your credibility, just as you have called into question the journalist's:
>> I would have felt calmer if that assuring voice wasn't the third comment from a month old account.
Would love to hear some analysis of this by people who actually know a thing or two about economics. Is it more of the usual baloney?
Debt is only ever a problem for a country if a) it is trying to maintain a fixed exchange rate or b) the debt is denominated in gold or a foreign currency. Neither of these is true for China, so it's level of debt is not a problem. In fact, under a fiat currency system the entire concept of "debt" is a misnomer for sovereigns. Sovereign debt is must better thought of as interest bearing currency.
What about interest payments? What about the risk of having the debt called in, or the risk of using up all of one's credit?
One reason I'm skeptical about this is the the United States has a ton of debt (this is a definite fact), and someone had to lend us the money. China has over $1T of U.S. Treasury Bonds. It might be plausible that they have cash flow problems, since they can't exactly liquidate $1T of U.S. Bonds, but then why do they keep buying them? In any case, I don't buy this one bit, especially since I haven't heard a single re…
Earlier quoted context omitted.
We _know_ that the UK, and while it isn't within my direct sphere of knoweldge, it seems common knoweldge the US too are in a fairly dire financial situation, though their AAA credit rating and various other orchestrated advantages cover that for them (oil bought in Dollars for example). Also we can see that plenty of other countries that don't have similar advantages are closer to real trouble (Greece being propped…
> whatever the truth about China. The question at hand is essentially: What is the truth about China ? I am not sure why you are bringing up US and UK finances and itching to make the comparison. Sure, making China look bad might further interests in the west, but it says nothing as to the article's accuracy. It is good to note that the article may be biased against China, but I think the focus should be on the facts…
Right, I meant that weego's comment were calming, since China and the West are connected economically. If one gets big problems it will probably spread to the other.
I've just seen too many new accounts argue positions like defending China's behavior in Tibet, etc to trust unknown voices about things that can look bad for China's government.
I'll take that -4 as a notice to try to write better/clearer. :-)
Earlier quoted context omitted.
Debt is only ever a problem for a country if a) it is trying to maintain a fixed exchange rate or b) the debt is denominated in gold or a foreign currency. Neither of these is true for China, so it's level of debt is not a problem. In fact, under a fiat currency system the entire concept of "debt" is a misnomer for sovereigns. Sovereign debt is must better thought of as interest bearing currency.
> Debt is only ever a problem for a country ... What about interest payments? What about the risk of having the debt called in, or the risk of using up all of one's credit?
If your doing business in China, massive debt heightens the risk that you simply won't be paid. The real risk here is ever tightening controls on Chinese borrowing and investment dollars flowing in. That would have a crippling effect on overall growth.