USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

[dummass]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

If you want to fix nearly every economic ail America is in right now, allow a proper wave of immigration. Hell, give incentive to allow the best and the brightest to come. It would be better than the FIRE economy policy of looking the other way on illegal (cheap) labor.

How about this program: Serve in the US military for three years and become naturalized. Assuming you make it back from ...

http://www.hooyou.com/naturalization/class.html

[goadam1]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Service Guarantees Citzenship!

http://www.youtube.com/watch?v=SMTz9nIUkGc

[goadam1]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Again I ask: Do I teach my kids Mandarin or how to grow there own food? Wait, didn't I hear this stuff before about the Soviets or Japan?

[dummass]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

If you see it on TV, it must be real. Another reinforced conditioned response.

http://allpsych.com/psychology101/conditioning.html

[ggirod]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

From goadam1

Again I ask: Do I teach my kids Mandarin or how to grow there own food? Wait, didn't I hear this stuff before about the Soviets or Japan?

The answer is pretty obvious. If you manage to site your family with inherited land in an area not prone to drought given global warming, which means probably east of the Mississippi and as far north as possible, then growing their own food is a real possibility. I suspect that China will neither crave nor desire the pathetic products produced by our post-FIRE economy. Also, I suspect that they will have no shortage of capable people and facility in Mandarin will probably not take an American far.

In the beginning, exploiting rich resources of North America was the basis for amazing growth. This time, the remainder may suffice for survival as the next generation tries to pick up the pieces that the ruins the FIRE economy left them. If they are as abysmally stupid as their parents then they will squander the remainder of their resources and die out. Maybe instead, they will be challenged by the problems and overcome to rise again. Or, maybe they will be content to have full tummies, a nice place to live, and a lifestyle of simple pleasures and relatively pure food and water.

[ThePythonicCow]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

China’s Syndrome: The “dollar trap” in historical perspective

Olivier Accominotti 23 April 2009

China’s “dollar trap” has many analysts worried about its future resolution. This column discusses a similar situation in the 1920s when France held more than half the world’s foreign reserves. France’s “sterling trap” ended disastrously. Sterling suffered a major currency crisis, French authorities lost a lot of money, and subsequent policy reactions deepened the Great Depression.

A 32 page PDF document The Sterling Trap Foreign reserves management at the Bank of France, 1928 – 1936, by Olivier Accominotti (November 2008), provides what seems to be more details in an earlier version of this study.

[*T*]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Professor Katz is more than half crazy, but also completely brilliant. He had this to say on the topic:

...

Sad but true.
http://wuphys.wustl.edu/~katz/scientist.html

Very, very familiar. Unfortunately true in the UK too.

[moan] Science for me is a compulsion, not a career [/moan]

[touchring]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

When the pound eventually collapsed, the Bank of France was put into a state of technical bankruptcy. It was only able to survive thanks to a state’s rescue, obtained under tough conditions. Moreover, there were now rising fears over the dollar. The will to avoid further losses therefore led authorities to convert all their dollar assets into gold (figure 2), a policy that heavily contributed to the global monetary contraction of the 1930s.

Why would converting dollar to gold cause monetary contraction?

[goadam1]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

From goadam1
The answer is pretty obvious. If you manage to site your family with inherited land in an area not prone to drought given global warming, which means probably east of the Mississippi and as far north as possible, then growing their own food is a real possibility. I suspect that China will neither crave nor desire the pathetic products produced by our post-FIRE economy. Also, I suspect that they will have no shortage of capable people and facility in Mandarin will probably not take an American far.

In the beginning, exploiting rich resources of North America was the basis for amazing growth. This time, the remainder may suffice for survival as the next generation tries to pick up the pieces that the ruins the FIRE economy left them. If they are as abysmally stupid as their parents then they will squander the remainder of their resources and die out. Maybe instead, they will be challenged by the problems and overcome to rise again. Or, maybe they will be content to have full tummies, a nice place to live, and a lifestyle of simple pleasures and relatively pure food and water.

lol. come on we won't wind up worse than Portugal. My favorite part of this is we were on a course for dollar collapse and detoured. Those detours included black swan events like winning the cold war, gulf war 1 and it's effect on oil prices and the internet. Just saying.

[Charles Mackay]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

China’s Syndrome: The “dollar trap” in historical perspective

Olivier Accominotti 23 April 2009

China’s “dollar trap” has many analysts worried about its future resolution. This column discusses a similar situation in the 1920s when France held more than half the world’s foreign reserves. France’s “sterling trap” ended disastrously.

Great article... thanks for posting it.. I wonder if France converted to gold before FDR's 69% devaluation? With China's latest 400 ton accumulation they maybe on this same path already.

[jk]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Great article... thanks for posting it.. I wonder if France converted to gold before FDR's 69% devaluation? With China's latest 400 ton accumulation they maybe on this same path already.

my understanding is that china accumulated this position from their own domestic production. what will be interesting is if the imf decides to sell its gold.

[c1ue]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

I've seen this paper before - Yves on NakedCapitalism posted a link to it some time ago (1 month?).

The question I have is that this example may not apply due to a special circumstance. That circumstance is the French undervaluation of their currency just prior to a currency agreement - this is what led to their surplus to begin with.

Thus France did not have an ongong cost*productivity based advantage but rather a legal/political one.

The reason this might matter is that in a cost*producivity based advantage, past accumulations are added to by ongoing operations. In the legal/political one, what you've got is all you're going to get.

In more prosaic terms: fixed income vs. working income. In an inflationary period, those on fixed incomes can only try to exchange their capital (if possible) into some other form less affected by inflation whereas working incomes can be negotiated for higher pay increases as offsets.

[Munger]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Why would converting dollar to gold cause monetary contraction?

Because the dollar was tied to gold. Governments on the gold standard would convert their currency to gold at a fixed rate.

France was presumably getting its gold from other governments. The other government would give France some gold in exchange for its currency, which would take that currency out of circulation (unless it could find more gold on the market to buy and thus put the currency back into circulation).

[LargoWinch]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

Top Chinese Official: I think you and the IMF should issue bonds in yuan.

Geithner: Lets go back to the safest currency, shall we?

Top Chinese Official: That is what I meant.

Sun Jun 7, 2009 4:06pm EDT
NEW YORK (Reuters) - A top Chinese banker on Sunday called on the U.S. government and the World Bank to sell yuan-denominated bonds in Hong Kong and Shanghai to encourage the development of debt markets in those centers and to promote the yuan as a major international currency.
...

Reuters Article here.

and another article here too.

[ocelotl]

Re: USA Fire Sale, 2nd Meeting, June 2009: Political capital call - Eric Janszen

worse than that! they come here. we make them into the best engineers in the world. they fall in love with the usa... their college town, whatever... and want to stay, to start the next great high tech company. do we let them? no! we make them go home.

nuts!!!

Worse. Many are invited via head hunter based scholarships to outstanding foreign students. I know, I rejected two invitations offered in my last university year.