Long weekends offer occasion for lengthier essays. This one is timely, and extremely important. It reflects the effort of a friend, who's listened to what's being said. We should too.
While what the Trump team appear to be offering is appealing to the USA, the thing that has to be taken into account is the question of confidence.
A nation can proudly strut and squawk about this or that. About exceptionalism or otherwise. But if the other 8 billion people on the planet and their governments smell BS and self interest, just as Matt Smith suggested with reference to the population of the USA, the people that constitute the majority of the planets inhabitants may be willing to experience hard times to achieve the autonomy and freedom from tyranny that the US frequently espouses.
China currently exports around 1.5% of it's exports to the USA.
Don't be surprised if they simply turn their back on the US markets in favour of their belt and Roads partners.
With regards to the US revaluing it's gold assets, this may be a case of shooting itself in the foot. The USA allegedly has around 8,130 tonnes.
Russia reportedly has 12,000 tonnes and China, according to Alasdair Macleod from Goldmoney.com and latterly from MacleodFinance.com estimates that China may have as much as 40,000 tonnes of gold.
The golden rule is that he, or she that has the gold. makes the rules.
This is an excellent expose of what I find, the most complicated subject in existence.
Here are the points which I find to be most important:
Trump wants a weaker dollar, but he also wants it to remain the world reserve currency.
Tariffs are put in place for imports, which help weaken the dollar, as countries are forced to revise their currencies. As when Congress got Japan to suppress the Yen through enacting tariffs.
America’s “exorbitant privilege” as it was referred to by Valéry Giscard d'Estaing "allows the country to avoid balance of payments crises because it can purchase imports with its own currency (which its central bank can “print” at will)."
The US dollar as the world reserve currency is desired by most countries throughout the world, especially when paying for imports.
This makes the demand for dollars vast, lowering the cost to borrow for Americans state side when they buy foreign products at home.
And with such an abundance of dollars to pay for imports, there is no need to manufacture goods at home.
Unfortunately, cheap foreign goods, with manufacturing off shore, has caused a decline in US industry. Thus, the US has switched to a financial industry of printing money and going into debt.
Getting trading partners to accept being paid for imports by buying US Treasury bonds is a bad deal for them, due to the exorbitant debt.
However, as the excess dollars keep getting printed, the value of the dollar weakens. . . . and,
"As the dollar weakens, the debt is wiped away… which seems the only way it could ever be paid. In this scenario, bonds get crushed."
"As domestic manufacturing declines, global confidence in the currency begins to wane." What I don't understand is this:
"Conversely, inadequate deficits deprive the world of currency, which strengthens the dollar and incentivizes corporations to move manufacturing offshore." . . . Can someone please explain this?
A Sovereign wealth fund will be put in place to maximize the monetary gains from national assets, and direct these gains for beneficial goals, within the country.
This will lesson taxes for Americans.
Thank you so much for helping me understand a wee bit more about this humongous subject.
Amazing tutorial. Not sure I understood anywhere near enough of it to grasp its many implications.
What I did discern is that no one seems to be making the case to reduce spending in an orderly manner as a means to reduce the federal debt
Trump could have done this without Musk in a controlled manner that did not create the havoc he's created
Federal employees and their families deserve better, especially our poor and starving beneficiaries here and abroad many of whom will be motivated to become illegal immigrants.
Frankly, I fear the exotic solutions that your touched on will be too complex for most people on this planet to understand.
While what the Trump team appear to be offering is appealing to the USA, the thing that has to be taken into account is the question of confidence.
A nation can proudly strut and squawk about this or that. About exceptionalism or otherwise. But if the other 8 billion people on the planet and their governments smell BS and self interest, just as Matt Smith suggested with reference to the population of the USA, the people that constitute the majority of the planets inhabitants may be willing to experience hard times to achieve the autonomy and freedom from tyranny that the US frequently espouses.
China currently exports around 1.5% of it's exports to the USA.
Don't be surprised if they simply turn their back on the US markets in favour of their belt and Roads partners.
With regards to the US revaluing it's gold assets, this may be a case of shooting itself in the foot. The USA allegedly has around 8,130 tonnes.
Russia reportedly has 12,000 tonnes and China, according to Alasdair Macleod from Goldmoney.com and latterly from MacleodFinance.com estimates that China may have as much as 40,000 tonnes of gold.
The golden rule is that he, or she that has the gold. makes the rules.
Be careful what you wish for...
Completely agree with your points/concerns. Very valid.
This is an excellent expose of what I find, the most complicated subject in existence.
Here are the points which I find to be most important:
Trump wants a weaker dollar, but he also wants it to remain the world reserve currency.
Tariffs are put in place for imports, which help weaken the dollar, as countries are forced to revise their currencies. As when Congress got Japan to suppress the Yen through enacting tariffs.
America’s “exorbitant privilege” as it was referred to by Valéry Giscard d'Estaing "allows the country to avoid balance of payments crises because it can purchase imports with its own currency (which its central bank can “print” at will)."
The US dollar as the world reserve currency is desired by most countries throughout the world, especially when paying for imports.
This makes the demand for dollars vast, lowering the cost to borrow for Americans state side when they buy foreign products at home.
And with such an abundance of dollars to pay for imports, there is no need to manufacture goods at home.
Unfortunately, cheap foreign goods, with manufacturing off shore, has caused a decline in US industry. Thus, the US has switched to a financial industry of printing money and going into debt.
Getting trading partners to accept being paid for imports by buying US Treasury bonds is a bad deal for them, due to the exorbitant debt.
However, as the excess dollars keep getting printed, the value of the dollar weakens. . . . and,
"As the dollar weakens, the debt is wiped away… which seems the only way it could ever be paid. In this scenario, bonds get crushed."
"As domestic manufacturing declines, global confidence in the currency begins to wane." What I don't understand is this:
"Conversely, inadequate deficits deprive the world of currency, which strengthens the dollar and incentivizes corporations to move manufacturing offshore." . . . Can someone please explain this?
A Sovereign wealth fund will be put in place to maximize the monetary gains from national assets, and direct these gains for beneficial goals, within the country.
This will lesson taxes for Americans.
Thank you so much for helping me understand a wee bit more about this humongous subject.
Thank you for the thoughtful response and nice comments. Very kind of you.
Amazing tutorial. Not sure I understood anywhere near enough of it to grasp its many implications.
What I did discern is that no one seems to be making the case to reduce spending in an orderly manner as a means to reduce the federal debt
Trump could have done this without Musk in a controlled manner that did not create the havoc he's created
Federal employees and their families deserve better, especially our poor and starving beneficiaries here and abroad many of whom will be motivated to become illegal immigrants.
Frankly, I fear the exotic solutions that your touched on will be too complex for most people on this planet to understand.