Note: This article ran back in February.
This was rebuilt from notes and is essentially similar.
by J John Swanko
2/09/10 (People Port) As US China relations enter a new rub, Arm Sales to Taiwan, The two giants search for a brighter path together. All types of calamities are predicted. Our Fed, for its part, announced it will start the unwinding of this Great Recession fix.
The gold bugs are happy, war always drives up the price of gold. EU arms manufacturers see this as a chance to sell all types of -Wow- military stuff to China. America sees the sale, good for exports. Answering, China's missiles aimed at Taiwan. China has interfered with our Navy on maneuver's.
That grew into joint US China military exchanges. China has asked to cancel those. We need to stay engaged. China, for its part, asked it be given the same deal as Taiwan -even more exports. The problem has been its small arms sales in Africa. This all started after Tienanmen Square.
China, when pushed very hard, will use force. The EU argues that was a very long time ago and we should sell her anything she wants to buy. The real friction will come as monetary measures are considered by China. Not buying our debt is not the problem it once was. As some see the maneuver, the debt card, can only be played for a short time. We have Secretary Geithner, a tiger in finance. He may simply offer China 200 million ounces of gold.
The Trojan horse would be seen by gold bugs as joyful. China has been buying gold for her own reserves, the US only produced 1.5 million ounces last year. China's gold mining is just getting underway. Cannot get any better for gold bugs. China needs our treasuries to keep her economy going. What would happen is President Obama would see those high paying gold miners as new jobs, opening up vast untapped deposits of gold on federal lands.
While this is going on, the EU depends on Greece for a large part of its needed gold reserves. Greece's economy is in turmoil right now. Selling gold to help would be on the top of its list. The 500 ton per year limit on gold sales would hit the waste basket. This all would be good for Russia, US, and Canada. That new gold rush would create many well paying jobs. The world's economy will take a hit. Some feel the unemployment is a deserved consequence of bad fiscal policy.
No person expects China exports, lack of internal consumption, rising home prices, would [yield] benefit[s]. Nations coined silver, gold, as a use for those precious metals. At one point UK coin makers complained at all the[ir] work shipped to France. Soon, the nations came to understand the true cost of trade. Well, here we are again. How many times will nations repeat these same misteaks. Will Beijing and Washington see the arms sales as what more than one American saw it as a sneaky way to sell our fancy arms to China (Rumor that reunification of Taiwan and China would happen sooner rather than later).
As China has repeatedly called for in recent history, Export to us. May be the very best way to work through these issues. China must let US know when we hurt her. Most likely, we do that more than we know. China has become very good at exporting to US. We must learn how to export to her.
The old adage, Look at the price of gold and you see inflation. Seemed to hold for many years. Some use the price of gold as a measure of war, war threats. Well it has moved with tension in the past.
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