Arthur,
At 21:25 13/09/2011, you wrote:
Keith I think that future historians will examine the relationship
between Hillary Clinton on the board of Walmart, Bill Clinton as
ex-governor of Arkansas (headquarters for Walmart) and Pres. Clinton
granting China most favoured nation status allowing Walmart to
access a low cost source of product. This all happened when
Walmart's profits were slipping and they had to do something about
the bottom line.
(and I suppose we can recall the money from China that went to
support Bill Clinton's campaign for president, second time as I recall)
<http://gopcapitalist.tripod.com/clinton-scandals.html#Chinese>http://gopcapitalist.tripod.com/clinton-scandals.html#Chinese
I suppose they will. The evidence seems convincing to me. Over here
also, politicians of the left are quite as corruptible as those on
the right. Like the Clintons, the Blairs, with several houses and an
annual income in the millions are doing very well for themselves.
Keith
arthur
From: Keith Hudson [mailto:[email protected]]
Sent: Tuesday, September 13, 2011 11:38 AM
To: RE-DESIGNING WORK, INCOME DISTRIBUTION, , EDUCATION; Arthur Cordell
Subject: RE: [Futurework] The approaching sanity
Arthur,
At 14:21 13/09/2011, you wrote:
Interesting. When the history of this time is written we may see
how cheap exports from China to US (and elsewhere) led to China
holding US dollars which were later used for a variety of things
including buying up assets everywhere and making inroads into the EU
by buying Italian paper. The Walmartization of America seems to
have led to a strange and unintended outcome.
Yes indeed. The question that future historians will ask is: If
America had not allowed the dollar to be overprinted from 1971 and
onwards (when Nixon de-linked the dollar from gold) then what would
China have done? In my view, because of the awful blunders of Mao
Zedong's Great Leap Forward in the '50s, and the craziness of the
Cultural Revolution in the '60s, Deng Xiaoping would still have
taken power and would have still instituted total reforms of the
administration and, even more importantly, a total re-cast of its
economy from mostly heavy industry to a more balanced one as in the
West. But China's new economy would not have taken off at anywhere
near the same speed if oodles of cheap Eurodollars and Asiandollars
had not already accumulated and were ready to pile into China via
American corporations and huge Chinese ex-pat businesses in Hong
Kong and elsewhere in SE Asia. Cheap Chinese labour certainly helped
(and was obviously a great attraction to all these incoming
businesses) but as far as sheer quantity of production is concerned,
and the types of goods made, cheap labour was nowhere near as
important to the Chinese economy than the modern industrial methods
and the (tremendously important) marketing know-how that the
incomers brought with them. Without the incomers and their dollars
and expertise, the Chinese export industries would have been mainly
home-grown and would have stayed that way for years, perhaps
decades, to come. They would not have been kick-started into
modernity. Chinese exports would have resumed with the same sorts of
products that they had previously been exporting in the 18th and
19th centuries (that is, before war ravaged both Europe and China in
the 20th century) -- such as hand-painted porcelain, silk fabrics,
hand- made wooden toys and furniture and the like. Of course, China
would still have developed from the 1980s and onwards but at nowhere
near the speed that it actually did. Furthermore, America (and
Europe) would still have retained a considerable part of its former
consumer goods industries.
America's dollar-printing policy of the last four decades, and the
more recent growth of credit on top of it by its rampant investment
banks, must take the major blame for China's eruption into the
modern world and America's present predicament.
Keith
From: [email protected] [
mailto:[email protected]] On Behalf Of Keith Hudson
Sent: Tuesday, September 13, 2011 5:26 AM
To: RE-DESIGNING WORK, INCOME DISTRIBUTION, , EDUCATION
Subject: [Futurework] The approaching sanity
Some credence has been given to my last paragraph of yesterday piece
by the news late yesterday that Italy's finance minister Tremonti
appealed to China's Investment Corporation last week to buy the next
wave of Italy's debt due on 15 September. The news apparently
rallied Wall Street share prices last night.
This oughtn't really to be a surprise. Italy's recent attempt at an
austerity plan is even more likely to cause country-wide strikes and
a collapse of its government than the present predicament in Greece.
No-one knows the outcome of the discussions. Furthermore, there's
unlikely to be any sort of public disclosure at any time. More than
likely, though, the fragility of the Eurozone is now so extreme that
some deep understanding will have to be reached, and China will have
to make some very important decisions. From China's point of view,
the Eurozone can't be allowed to collapse if it's all possible. The
Eurozone is not only an important source of import goods (high grade
machine tools, engineering know-how and luxury cars, etc mainly from
Germany), but the Euro itself is an important currency ally against
the ever-cheapening American dollar.
Also, if the Eurozone collapses, and many European banks are
devastated, then the effect on American banks (holding substantial
European liabilities) is such that America would likely plunge
instantly into a deep depression. China wouldn't want that to
happen. It's one thing for America to slide slowly into recession,
as it is patently doing right now, but it's quite another if America
unleashes yet more quantitative easing and devalues the dollar at an
even faster rate. From China's point of view, America and the
Eurozone must both survive somehow for as long as possible until
both accept the necessity of a world-wide stable trading currency
which China has been calling for for years.
Of the two problematiques, America is by far the more intransigent
for psychological reasons. Just as the opinion-setters of England
(politicians, civil servants and the media) experienced in the 1930s
in trying to adjust to its governmental debt and the demise of the
British Empire (and the necessity of constantly devaluing the
pound), so America is experiencing the same today. America was
probably at its peak of power in the 1960s at the time of taking on
the communists in Vietnam -- and losing -- and it's been downhill
all the way since then despite its still numerous military bases in
many countries. Its last big episode of invading Iraq, but now
having to leave the country with even more problems than it had
before (with Sunni terrorism of Shias running amok and without, as
yet, America getting a drop of oil from Iraq's massive undeveloped
oilfields in the north), together with America's increasing
humiliation in Afghanistan by the Taliban, all this eloquently
demonstrates that America must now adopt a more humble role in the
scheme of things just as England had to (most of its intelligentsia anyway).
If America continues with its dollar-printing strategy, thus
maintaining prime-mover advantage in cheapening its exports and
subsequently throwing increasing inflationary strains on China and
the rest of the emerging world, then it will be punished, just as
England was. It won't be China that will do the punishing. It will
be the whole world market through the agency of scores of central
banks around the world, mainly of the emergent countries, which are
now buying gold as their ultimate safe foreign exchange reserve.
Since 1999, this increasing necessity has already produced as smooth
an accelerating price curve as any scientist could wish to see from
an experiment.
The price rise is due to go vertical by this time next year. Before
then, at levels of gold prices that will become approachably
convenient to one country after another, governments will decide to
back their currencies by the amount of gold in their central banks.
And here the same prime-mover advantage will obtain. Those countries
who are the earliest to do so might well suffer a brief hiatus of
trade while their trading partners adjust but will very quickly
benefit while the free market price of gold continues to rise. There
won't be a panic crash in the gold price. There will be a more or
less panic flattening out. There will be a reversion to the
illogical, but yet status-driven, centuries-old obsession with gold
that will once again stabilize our financial systems and prevent
money inflation for good and all (just as happened in England all
through the 19th century).
But just a final word to those steady-staters who, like me, think
that the advanced countries are already becoming locked into a
particular urban-dense way of life that will last for a very long
while (while some of the other countries -- but by no means all --
catch up), a non-inflationary world currency doesn't mean
stultification. Man's frontal lobes are too curious for that. We
will always be making discoveries and will always want to make more.
There's no reason why, in a world in which the mass of everything we
need by way of consumer goods will be made, freighted and sold by
automated methods, we should not also gradually carry out
infrastructure changes that will lead to a sustainable economic
future that will be friendly to nature and the amazingly fascinating
world it displays about us.
Keith
Keith Hudson, Saltford, England
<http://allisstatus.wordpress.com/2012/08/>http://allisstatus.wordpress.com/2012/08/
Keith Hudson, Saltford, England
<http://allisstatus.wordpress.com/2012/08/>http://allisstatus.wordpress.com/2012/08/
Keith Hudson, Saltford, England http://allisstatus.wordpress.com/2012/08/
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