Global Slave to the US Dollar

October 29, 2010

I read an interesting post at Business Insider by Charles Hugh Smith – Here’s Why China loses Whether The Dollar Strengthens or Weakens.

Smith’s opinion is that China cannot win the currency war with the US because the yuan’s value is linked to the dollar and China is trapped.

He says that if the US dollar loses value, China will pay more for the imported commodities needed to fuel its economy—the lower the dollar sinks, the more commodities will cost.

If the dollar strengthens, goods manufactured in China for export will cost more to sell.

If Smith is right, this explains why China wants to replace the dollar with a basket of currencies to compute the value of the yuan for global trade.

This also explains why other nations (such as the BRIC), a few oil rich Middle Eastern kingdoms and several European nations want the same thing China wants.

The world appears to be exhausted by America’s Wild West debt ridden economy and they want to dismount from the dollar and replace that old nag with a herd.

I wonder what Smith thinks would happen if the dollar were replaced as the globe’s master currency.

Learn more about the Sinking Dollar

______________

Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

Leave a Comment » | America, China, economy, politics | Tagged: , , , , , | Permalink
Posted by Lloyd Lofthouse

The Have or Have Nots at the G-20 in South Korea

October 28, 2010

The world appears to be divided between nations that have spent too much and those that save.

In China, people that hold onto money are called “Iron Roosters”. In the US, we call people who save stingy or skin flints or other insulting terms. The average saving rate among Chinese is about 40%, while the average family in the US carries several thousand dollars in credit card debt.

According to the Wall Street Journal, the US is among the ‘Have Nots’. In G-20 Deal to Curb China is Weakened, Evan Ramstad and Bob Davis said that “China, Japan and Germany all have surpluses; the U.S. has a deficit.”

However, the US is not alone. “Australia, Canada, Britain and France, all of which have current-account deficits, lined up with the US” to pressure China to let the value of the yuan rise.

The US and other Western nations that have overspent need to export more products to other countries and import less.  For this to happen, the US dollar must be worth less than the Chinese yuan to pressure U.S. consumers to stop buying products made in China when prices for those products become higher than what is manufactured in America.

This means that countries with money in the bank want to rely less on exports for growth and more on homegrown demand instead of buying more products from the debt-ridden nations.

Germany’s current account surplus is about 6%, Japan’s 3% and China is at 4.7%. The U.S. is running a 3.2% deficit, which should be no surprise.

It appears that China won this round and will not loosen controls on the value of the yuan yet.  The US went into the G-20 summit in South Korea wanting to punish China for US consumer appetites to buy cheap foreign made goods.

Instead, little was accomplished.

It’s all about the national interest of each nation, and China and America have opposing interests.

If America wins, China loses.

In fact, whoever, wins this global currency war will be the stronger for it. The question is, Will the Iron Rooster win or the Buy Now Pay Later nation?

See Democracy’s Economic Roller Coaster

______________

Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

Leave a Comment » | America, China, cultural differences, economy | Tagged: , , , , , , , , , , | Permalink
Posted by Lloyd Lofthouse

Every Vote Counts

October 28, 2010

Fear tactics still grab votes or American conservatives would stop using them.

Since America’s 2010 midterm elections are being held in November, the Citizens Against Government Waste (CAGW) ran a political video designed to exploit fear of China.

Abraham Lincoln said, “You can fool most of the people some of the time and some of the people most of the time…” 

Evidently, the CAGW decided they could fool some of those people in time to make sure they vote against Democrats.

New York Magazine ran a piece, Is this Really the Best Political Ad This Year, which proves why it is dangerous to be a democracy instead of a republic.

Ben Smith of POLITICO writes, “This slickly-produced new ad from Citizens Against Government Waste … attacks spending in the Mandarin-speaking voice of a gloating, future Chinese professor.”

The sad thing is that millions of Americans believe these distortions.

According to the PEW Global Attitudes Project, 36% of Americans view China with an unfavorable view.

It is no secret that Rush Limbaugh is a Sinophobe and has between 14 and 30 million listeners (depending on who you read).  Glenn Beck has about two to three million. 

In fact, the people that Rush and Beck appeal to must be some of the voters the CAGW is hoping to influence.

The National Center for Educational Statistics shows us that forty-three percent of Americans read at or below basic, which means 93 million votes could be influenced through fear of China.

After all, the illiterate and semiliterate are the easiest voters to fool and that’s why they shouldn’t be allowed to vote.

Learn more at Democracy, Deceit and Mob Rule

______________

Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

2 Comments | America, American culture, China, media, politics | Tagged: , , , , , , , , , , , , , | Permalink
Posted by Lloyd Lofthouse

Silicone “Juice” in China

October 27, 2010

In You Can’t Build a New Silicon Valley Just Anywhere by Margaret O’Mara, writing for Foreign Policy magazine, she says, “for many of the would-be silicon cities being constructed by the Russias and Chinas of the world; with their long histories of centralized control, they are still convinced they can order up success.”

O’Mara’s theme is that the success we have seen in California’s Silicon Valley is due to the freedom America’s republic—now a democracy—offers along with loads of money from the government and venture capitalists with no strings attached.

If that were true, explain how China (ruled by Emperors under an autocratic imperialistic monarchy) was more technologically advanced than any country on earth for almost two thousand years.


If you don’t speak Chinese, the English subtitles say it all.

After all, the Chinese invented the stirrup for saddles which revolutionized warfare on horseback, gunpowder, the multistage rocket, the compass, paper, the printing press and pasta along with a long list of other innovations, which changed the world.

Without the Chinese, where would the world be today? See Chinese Crossbow and other Inventions

China may not offer the same individual freedoms the West does, but “face”, which is important in Chinese culture, is a strong motivator to improvise and invent so one gains “face” and becomes powerful and wealthy.

Before Deng Xiaoping and the “Getting Rich is Glorious” generation that he gave birth to, I would have agreed with Margaret O’Mara but not now.

In my next series, The Machines of Ancient China, we will discover more about China’s contributions to the world we live in.

To discover the Chinese advantage, learn about Guanxi in China

______________

Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

2 Comments | America, business, capitalism, China, Chinese Culture, cultural differences, environment, science | Tagged: , , , , , | Permalink
Posted by Lloyd Lofthouse

The University Influence

October 25, 2010

Many American Conservatives and most Sinophobes probably won’t want to learn this but millions of Chinese students from Communist China have attended American universities and colleges and earned degrees.

Many of these students return to mainland China influenced by what they learned in America.

Imagine, when China’s growth to become a modern nation is complete, the country might turn into a republic and/or democracy influenced by America’s “so-called” socialist, liberal institutions of higher education.

I’m sure members of the GOP and the Christian Coalition would much rather have educated these Chinese citizens in conservative Christian colleges and universities. Too bad.

Next time you visit USC, MIT, UC Berkeley, Harvard, Stanford or UCLA, look around.  How many Chinese faces do you see?

In USA Today, there is a piece about Chinese college students flocking to U.S. campuses and says that last year alone, 98,510 Chinese graduate and undergraduate students poured into U.S. colleges and universities lured by China’s emphasis on academic achievement and the prestige of U.S. higher education.

However, this did not start recently and it isn’t free. In fact, it costs a lot of money for a foreign student to attend a college or university in the U.S.

Since the door out of China opened as early as 1980, more than a million Chinese students have graduated from the U.S. and returned to China, which may explain China’s Sexual Revolution in the late 1990s.

It might shock Americans to realize that most of the people in China that have the money to send their children to the US belong to the Communist Youth League or the Communist Party so many of the children of China’s leaders have lived in and been educated in the U.S.

No wonder, China wants to be the next America and people in China stand in line to eat at Pizza Hut.

In fact, if there was a revolution in China to replace the Communist Party, don’t be surprised if the survivors moved to America where many already own houses and have bank accounts.

Dr. Sun Yat-sen, the father of China’s republic, was sent to Hawaii in 1879 where he studied science and Christianity in college.

______________

Lloyd Lofthouse is the award-winning author of the concubine saga, My Splendid Concubine & Our Hart. When you love a Chinese woman, you marry her family and culture too. 

If you want to subscribe to iLook China, there is a “Subscribe” button at the top of the screen in the menu bar.

Leave a Comment » | America, American culture, China, education | Tagged: , , , , , , | Permalink
Posted by Lloyd Lofthouse

« Previous Entries
Next Entries »