Why foreign countries are important

[Jaga]

Mary asked an important question. Why we should care what Spain thinks about McCain not knowing who Spanish prime-minister is.

Unfortunately in the time of economical crisis understanding complex American-rest of the world relations are important.

Foreign countries are very important to the US. It is important that the countries who HEAVILY INVESTED in the US like China and EU would be able to trust that America is willing to pay its debts. Otherwise these countries can walk away from America completely.
American dollar unfortunately do not have subnatural strenght. America also do not have the powers to conquer or keep in fear other countries, so that they would not leave American markets.

We need a future leader who would not just say fairy-tales - that the taxes will never be increases on anybody, but we need a leader who would ensure the world that America is ACCOUNTIBLE for its money and its debt. That America is a serious country that does not just overproduce paper dollars.

What would happen if suddenly there will be no Chinese products in Wallmart?

[karl]

Jaga

Yes, there is a very real and present situation of crises, and it centres with the American economy. For the international markets are centred with the American dollar as the medium of exchange. For the value of money is only the trust of perception of value, in the case of the American dollar, it is a note of tender of the Federal Reserve. It is not backed up by a gold reserve for redemption upon demand of same.

If as the case may be, the American Fed. Infuses new money upon the market as a bolster against failure. What it will do is: create the dollar as worth less in new money against old money. Or as popular name,,,inflation.

Some time of the recent past, there was a measure considered with the Arabs to trade using the Euro. If this were to of occurred, it would have been a disaster to the American economy in consideration of the present decline in value of the American dollar. And, it would have required a considerable of expense to the international communities for re-adjustment in the various stock exchange for re-adjustment from the dollar value to the Euro in usage {it would have been a short time mess}.

But, now, where do we run for safety? Where is the calvary whilst the Indians are scalping us?

Karl

[Mary]

Sept 19, 2008 9:51:39 GMT -7 Jaga said:

What would happen if suddenly there will be no Chinese products in Wallmart?

Now thats an interesting question Jaga!
There are two schools of thought that come to mind.

First, yes without the influx of Chinese products we would have a lot of bare shelves. To replace those items for our consumption American manufacturers would have to step up and start production here, like they used to. The upside is that it would be good for the economy and job market. The downside is that the prices would certainly be higher.

Second thought, Chinese products have been so inferior and down right dangerous lately that we would surely be safer with American made products. There have been problems with lead paint in children's toys, contaminated dog food, and most recently melamine in powdered milk and baby formula.

(On a personal note, having a grandson poisoned by toxins, I would prefer bare shelves and higher prices. My heart breaks when I hear the babies that have died and more injured with this bad milk. It's proof to me that the Chinese are not out to get the US, because they sell inferior products to their own citizens. They care more about skimping on quality to push quantity for the almighty buck.)

[Mary]

Over 60 thousand babies Affected by tainted milk in China!

[Jaga]

Karl,

yes, change from dollar to Euro or some other currency was considered for some time. We will see. Personally, this will be a loss for us but who want to give free money to a giant who promises that its citizens nor corporations would not have to pay any bigger taxes to return this money?

Hello Mary,

I agree with you. Probably it would be better for America to be free from at least a part of Chinese goods. My question should be posed differently. I also believe that America need to produce more of its own goods, mainly due to the gas prices which would not go down ever in the future, unless we find another source of energy than petroleum.
I recommended a movie about a death of Am. Suburbs which talks about local commerse instead of importing.

The question is - Chinese positive balance in trade with the US is enormous. How America is going to pay this debt off? What if China and other countries would stop bringing capital to the US and support American lifestyle of overspending and overshopping?
American government does not act sensibly. The foreign investors do not want to finance costly and unsuccessful wars, they want strong dollar and accountibility.

WE LIVE HERE ON THE COST OF CHINA AND OTHER FOREIGN INVESTORS.

Do you believe that if we had 8 more Bush years - there would be anything left in this country to be hopeful about?

[tuftabis]

There' s more than one reason why what happens in other countries is important to US in our globalized world. Loss of credibility and acountability would certainly mean economic catastrophe. Would the foreign holders of United States debt claim the debt, the crisis would quickly spread and the most developed ecomomies would be hit the worst, which is US economy, European Union and Japan.
Only the least developed countries wouldn't have to lower the life level.
And this is the power of globalization. No country to which USA is indebted would risk sudden reclaim of the debt because that would riun the reclaimer as well.


The major holders of US treasury securities as an example are
Japan, China, Great Britain, OPEC countriesa and Brazil.

en.wikipedia.org/wiki/Image:Foreign_Holders_of_United_States_Treasury_Securities-percent_share.gif

[tuftabis]

Sept 19, 2008 9:51:39 GMT -7 Jaga said:

What would happen if suddenly there will be no Chinese products in Wallmart?

The sudden disappearnace of Chinese products would first of all mean an economical catastrophe in China with loss of basic life means for many millions of Chineese people.
For the US people it would mean start of de-globalization, with sudden and a huge rise in prices and extreme lowering of life level. Only the most rich wouldn't feel the difference.

[kaima]

Well, on top of everything else, all those countries run by furriners (hill billy or Presidential speech for foreigners) are the people who own our IOU's. If they call in our debt the world economy will collapse.

maybe we should give them a bit of respect.

Kai