And you don't think all of these non-Americans, you mention Asians, are pumping money over to America because they're dumb, do you? Of course not. They see a growing economy in America; they see a dollar that is weak by historical standards--so they're hoping that their investments in America will do well, and then if the dollar strengthens, when they bring the money back in their own currencies--they're hoping to make big money. I'm not sure I would bet against them.
The sky is not falling in America. In fact the stock markets are warming up over hear. Might be a good time to put some of the bucks in the savings account, into the stock market--you may be able to squeeze a few more years out of your rock star life style in Holland.
As I understand it, by looking at the MP3 figures you can tell when the big players are toying with the markets to make them come our right, so apparently we are not supposed to know they are doing it. Having the economy look good through the first half of 2006 seems to be the plan, and we are not supposed to notice how much fresh money is being pumped into the economy to keep the charade going.
The logic here is obvious to anyone familiar with drug addiction: When you are about to crash, snort another couple lines!
After the election in November, expect the wheels to come off. The Fates are kind.
The muse of poetry strikes:
Oh dear! Where can the money be? It's not going to wage power parity. There is a slight haze of obscurity. "Bubbles," his thumbs on the scale.
(OK. Mayhap it's the 'Moose' of poetry.)
And I don't think anyone per se is dumb here, either the Americans living far beyond their means or the Asians who are financing it. But to assume that somehow they are doing this for good, far sighted reasons is incredibly naive I think. A far more plausible explanation is that they are doing it for the reason most of us do the things we do--it seems like the easiest thing to do at the moment to accomplish their goals.
It is a fact that the japanese and chinese have been buying up billions of dollars in order to artificially keep their currencies lower in relation to the dollar so that their exports are not priced out of the market in the US. That can only go on for so long.
The proper, natural outcome for this situation--and there is wide agreement on this--is that the world is going to have to equalize somewhat. The US standard of living is unsustainable; this doesn't mean it will collapse, but it cannot go on the way it is, with perpetual, structural consumer and government debt. And it only makes sense that sooner or later the investor countries will skip the middle man (America) and start buying their OWN products.
