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China's State Press Calls For 'Building a De-Americanized World'

Unknown Lamer posted about 6 months ago | from the 1979-wants-their-rhetoric-back dept.

China 634

Hugh Pickens DOT Com writes "Businessweek reports on some not-so-subtle commentary from China's official Xinhua News Agency on the U.S. budget showdown: 'It is perhaps a good time for the befuddled world to start considering building a de-Americanized world.' Key among its proposals: the creation of a new international reserve currency to replace the present reliance on U.S. dollars. 'The cyclical stagnation in Washington for a viable bipartisan solution over a federal budget and an approval for raising the debt ceiling has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonized,' the authors write. 'The world is still crawling its way out of an economic disaster thanks to the voracious Wall Street elites.' The commentary calls for a greater role for developing-market economies in both the World Bank and the International Monetary Fund, adding 'the authority of the United Nations in handling global hot-spot issues has to be recognized. That means no one has the right to wage any form of military action against others without a UN mandate.' The commentary concludes that 'the purpose of promoting these changes is not to completely toss the United States aside, which is also impossible. Rather, it is to encourage Washington to play a much more constructive role in addressing global affairs.'" Meanwhile, U.S. Senate Leaders are claiming a deal is close to reopen the federal government until mid-January and defer the debt ceiling debate until mid-February.

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634 comments

Everyone open your firewalls (-1)

Anonymous Coward | about 6 months ago | (#45129667)

and let the Chinese hackers in. For the People's Liberation!

Re: Everyone open your firewalls (1)

Anonymous Coward | about 6 months ago | (#45129753)

I feel a change in wind, the US is going to get the kick up the ass it has been asking for.

Re:Everyone open your firewalls (1)

Anonymous Coward | about 6 months ago | (#45129763)

yes of course, it's the Chinese that want to spy you. "this is not the prism you are looking for"

Re:Everyone open your firewalls (0)

Anonymous Coward | about 6 months ago | (#45129817)

*cross-checks firewall log with geolocation*
NSA is secretly spying from Chinese IP ranges? Whodathunkit!?

Re:Everyone open your firewalls (3, Insightful)

TheRaven64 (641858) | about 6 months ago | (#45130103)

Yes, because it's so hard to buy a collocated server in China. You've not actually read any of the recent revelations about NSA practices, have you?

I'm Sorry, China (5, Funny)

Freshly Exhumed (105597) | about 6 months ago | (#45129671)

It isn't you, its me. I'm leaving you for India, as she is so much more able to fulfil my needs. I truly hope that you will find someone new. Let's be friends. - Uncle Sam.

Re:I'm Sorry, China (0)

Anonymous Coward | about 6 months ago | (#45129687)

shortly after such a statement the entirety of what remains of american manufacturing would grind to a halt.

Re:I'm Sorry, China (4, Insightful)

Anonymous Coward | about 6 months ago | (#45129697)

Sorry, but reality called, and Uncle Sam, I found out that China is the bitch, which you fed until she weighed 300lbs, that's now pegging your skinny ass with a 16 inch strapon you had it make.

I heard that India is taking your calls (at a call center no less) but it keeps talking until you tire out and can't manufacture shit.

Re:I'm Sorry, China (-1)

Anonymous Coward | about 6 months ago | (#45129715)

China been talking back so now its time to put her down. India treats me like a real man.

Re:I'm Sorry, China (0)

Anonymous Coward | about 6 months ago | (#45129837)

Wouldn't America be the women in this scenario, because she is trying to get china and india to build her entertainment units and setup her stereos so America can spend more time in the kitchen perfecting the big mac.

Re:I'm Sorry, China (-1)

Anonymous Coward | about 6 months ago | (#45129719)

Oh, the Hindus can manufacture shit all right. Right onto the street.

The piss, otoh, all goes into the Holy Ganges. Don't worry, it's sterile so they can still bathe in it and drink from it downstream.

Re:I'm Sorry, China (1)

Anonymous Coward | about 6 months ago | (#45129737)

The reality is Uncle Sam is the crazy trigger happy fat guy with tons of guns and China is the Asian guy he buys cheap toys from.

The funny thing is Uncle Sam pays in Uncle Sam tokens or worse - in trillions "worth" of Uncle Sam token IOUs!

Hence the talk by China of moving away from the US Dollar.

Re:I'm Sorry, China (0)

Anonymous Coward | about 6 months ago | (#45129711)

How about No?. - India.

Re:I'm Sorry, China (5, Insightful)

Dr Max (1696200) | about 6 months ago | (#45129791)

"Yeah that's cool sweetheart" says china "you two look good together, but first can you give those trillions of dollars i loaned you back."

Re:I'm Sorry, China (1)

Freshly Exhumed (105597) | about 6 months ago | (#45129819)

India says she will help me pay you back, and that I won't even notice any difference. She needs me, and I need her. - Uncle Sam.

Re:I'm Sorry, China (3, Insightful)

Dr Max (1696200) | about 6 months ago | (#45129861)

America sounds like the women in this to me. As she has bought far too much on credit, and think she can hook up with a guy and get them to help pay the bills, all the while getting him to build stuff for her. ;) Sorry ladies.

Re:I'm Sorry, China (1)

Anonymous Coward | about 6 months ago | (#45129979)

You keep fooling yourself that your country is going to be relevant in the future. Decline... get used to it. And your hick crazy politicians are just hastening this process. You are the weakest link - goodbye.

Re:I'm Sorry, China (2)

Aighearach (97333) | about 6 months ago | (#45129925)

The day when China tries to push up the maturation of its US investments will see US companies running for the border. I can't imagine that sort of nonsense would keep them there. Also, I don't think China is that stupid. Going to war wouldn't get them paid, that is for sure.

Also, if US companies move manufacturing to India, why would that affect the payment schedule? And, why would it affect China's need to park their giant pile of liquid assets somewhere? They might slow down their bond purchases, of course... but India would be increasing theirs.

Re:I'm Sorry, China (1)

Dr Max (1696200) | about 6 months ago | (#45129993)

I thought the idea was America was taking all it's manufacturing to india and now the balls in china's court. Which i then thought stood to reason is if china isn't getting some good contracts from America (they can't really be that good because they build it for peanuts, at least it provides jobs i guess, however that's another story) they would be a lot less likely to look favorably on the giant debt America owes them. Hell they may even need that money for a national project to replace the lost work.

Re:I'm Sorry, China (4, Insightful)

gtall (79522) | about 6 months ago | (#45130289)

The U.S. government couldn't reasonably ask U.S. business to leave China. First, they don't give a rat's ass whether its China or India, and second, U.S. companies don't give a rat's ass about what country the U.S. government thinks deserves their investment. And if the U.S. government tried to do such a thing, they could expect to spend the next 5 years in court litigating the proposal.

Re:I'm Sorry, China (1)

Anonymous Coward | about 6 months ago | (#45130283)

but first can you give those trillions of dollars i loaned you back

Treasury bonds are not "loans". They are investment instruments created and controlled by the US Treasury. They have a fixed maturity date and fixed interest rate at issue, China cannot "call in their loan", "jack up interest rates" or whatever else you imagine.

More importantly, the US Treasury has a register of ownership of those bonds. They can cancel the bonds purchased by any party, such as whoever China fronts through, without affecting the rest. So if China started making demands, its bonds could be effectively deleted without touching the rest of the market.

Re:I'm Sorry, China (0)

Anonymous Coward | about 6 months ago | (#45130005)

Enjoy constant electrical outages, ineffective administration and incredible corruption at every step of the way.

India, the only country who claimed a 620 million people electricity outage was caused by a cat.

Re:I'm Sorry, China (5, Interesting)

dinfinity (2300094) | about 6 months ago | (#45130017)

The idea of a love analogy is good, but in reality it is the rest of the Western world that has opened its eyes to the abusive relationship with the USA it is in.

The once present blind love for everything 'USA' (a lot of clothes sporting American text or imagery were made and worn in the rest of the world) has turned into a palpable disdain for the same. The more apt analogy for the current feelings would be: 'How can we get out of this relationship without that asshole going psycho on us?'

I wish it were different.

Everything they say is true. (1, Insightful)

Anonymous Coward | about 6 months ago | (#45129677)

US strategy is to print dollars and the rest of the world have to live with the consequences(inflation), as they control militarily the main sources of energy and people need their petro-dollars.

Re: Everything they say is true. (0)

Anonymous Coward | about 6 months ago | (#45129709)

No they don't, Europe gets a lot of its energy from Russia. You don't have the monopoly you think you do.

The Dollar (and its inflation) has no revelance to British Sterling or the Euro at all, which is why it's always weaker at around 1.5 â" 2 Dollars to the Pound.

Re: Everything they say is true. (5, Insightful)

Aighearach (97333) | about 6 months ago | (#45129941)

No they don't, Europe gets a lot of its energy from Russia. You don't have the monopoly you think you do.

There are not many countries that would prefer to be under Russia's thumb, however loudly they complain about the US.

Re: Everything they say is true. (5, Insightful)

Anonymous Coward | about 6 months ago | (#45130143)

There are not many countries that would prefer to be under Russia's thumb, however loudly they complain about the US.

Historically not. This is because it was widely known that Russia would screw you over hard.
With the recent revelations about NSA it is pretty clear that the US us following the same fucked up realpolitik and that you have to think of dealing with US in the same way as you think about dealing with Russia.
While both nations have a lot of wealth it is generally more beneficial to deal with other more idealistic nations.
It may seem like it is naive to be "soft" and kind hearted but in the long run people learn that they can trust you. I have seen this a lot in the business sector. Companies that makes sure that everyone involved benefits form the deals makes it in the long run.
Those who screws people over only lasts until word gets around. They do great for a decade or two until everyone else realizes that there is more money in working with other people.

Re: Everything they say is true. (0)

Anonymous Coward | about 6 months ago | (#45130237)

Of course in the long run, the goal is to need neither. Fortunately the sun and wind are controlled neither by the USA nor by Russia.

Re: Everything they say is true. (1)

Alioth (221270) | about 6 months ago | (#45130317)

Since Russia have shown they have no problems with meddling with energy supply for political ends, and damn the collateral damage (such as a spat with countries through which pipelines travel, they just cut that pipeline, plunging all the non-involved countries downstream into darkness) no one really wants to deal with Russia if they can help it.

Re:Everything they say is true. (0)

Anonymous Coward | about 6 months ago | (#45130309)

US strategy is to print dollars and the rest of the world have to live with the consequences(inflation)

US inflation does not affect the rest of the world, except to discourage hoarding of US dollars. It reduces the buying power of US dollars.

BTW, US inflation is currently near zero.

Re:Everything they say is true. (3, Insightful)

Anonymous Coward | about 6 months ago | (#45130347)

Well other countries (UK, Japan, China, Australia et al.) apparently don't believe they should "live with the consequences" of importing the USA's inflation, so they devalue their own currencies in an attempt to help their exports. Unfortunately this race to the bottom erodes the faith in the US dollar, and BRICS countries (Brazil, Russia, China, South Africa) are dissatisfied with the status quo and always call for a replacement of the US dollar at their annual meetings. BRICS are already drawing up their own version of the IMF and also will be trading among each other & non-BRICS without the US dollar! Agreements are in place. Most people in the US are completely unaware of the current situation.

They say the right things (1)

Anonymous Coward | about 6 months ago | (#45129681)

Now they need to do the right things too.

Summary says it all (5, Insightful)

muecksteiner (102093) | about 6 months ago | (#45129689)

The Slashdot summary already nicely shows why the Chinese do have a point of sorts:

"a deal is close to reopen the federal government until mid-January and defer the debt ceiling debate until mid-February."

In other words, the only thing they seem to be able to come up with is a deal to kick the can down the road for four months - and in the meantime, in all probability do exactly nothing about the underlying fundamental problems which have caused this mess in the first place.

You know, these pesky little details, like the U.S. habitually spending way more than it actually takes in tax earnings. As in: WAY more. A bit more could be argued to work in some lets-fudge-the-books-and-rely-on-inflation-to-make-it-work way, but the U.S. is light years from that sort of sustainable level. And no one wants to admit it.

The bit where the Chinese are IMHO wrong is that it will need any sort of centralised planning to achieve this replacement of the U.S. as hub of the global economy. That will just happen, inevitably. The fundamentals are gone, no way the U.S. can stay where it is. What will come afterwards is very uncertain - but things can stay the way they are.

Re:Summary says it all (1, Insightful)

Anonymous Coward | about 6 months ago | (#45129733)

Actually the real problem is passing the budget 25 teabagger members of congress will refuse to let a budget pass unless the ACA is delayed or repealed. But otherwise nice troll based on Fox News talking points. Thanks for playing.

Re:Summary says it all (2, Insightful)

jcr (53032) | about 6 months ago | (#45129887)

Here's a little tip for you, sparky: tossing off terms like "tea bagger" and invoking the anathema name of "fox news" doesn't in any way invalidate what someone is saying.

The real problem is that pinheads like you want to keep pretending that the USA has a revenue problem instead of a spending problem. It's still possible to prevent the USA from having a Soviet-style collapse, but to do that we'd have to immediately cut government spending to less than it collects in tax revenues.

-jcr

What he says is correct (0)

Anonymous Coward | about 6 months ago | (#45130011)

What the GP says is correct. The way he said it may not be politically correct, and it may offend you, but it is correct nonetheless.

Re:Summary says it all (3, Interesting)

Anonymous Coward | about 6 months ago | (#45130127)

You could start by halving military spending. I'm not a pacifist but it's pointless to have an army big enough to crush a (imaginary) army big enough to crush the second most powerful army in the world. Just being able to crush the second most powerful army in the world is enough.

Re:Summary says it all (5, Insightful)

Aryden (1872756) | about 6 months ago | (#45130303)

The real problem is that pinheads like you want to keep pretending that the USA has a revenue problem instead of a spending problem. It's still possible to prevent the USA from having a Soviet-style collapse, but to do that we'd have to immediately cut government spending to less than it collects in tax revenues.

There are both problems. The US Government spends like a bored trophy wife, meanwhile, incredible sums of taxes are not collected from higher wealth citizens because of loopholes and offshore accounting.

Re:Summary says it all (5, Interesting)

Anonymous Coward | about 6 months ago | (#45130335)

I recommend we shave a little off of the golden calf, AKA the military.

Do we really need to have troops stationed in as many places as we do?

Ohh and in case you were thinking of calling me unpatriotic or anything, I served and deployed.

Re:Summary says it all (5, Insightful)

Anonymous Coward | about 6 months ago | (#45129741)

Thank George W Bush junior for destroying the trust in the US around the world. Thank the Tea Party for making it look like the US is having a civil war of words over obamacare reminiscent of the slavery abolition talks during the actual civil war. At the end of the day Obamacare isn't going away, The Tea Party will be the losers, along with most of congress. The American people will win by finally having healthcare and being competitive with foreign nations who do. However the by the time it's in full force, the healthcare, welfare/disability fraud will probably have sunk the budget worse.

The US is on the road to ruin and all the gerrymandering possible is not going to save the republican party.

Re:Summary says it all (5, Insightful)

Anonymous Coward | about 6 months ago | (#45129813)

$16.7 trillion is not a partisan issue. Toss the lot of them for not knowing the difference between deficit and debt. The deficit could be zero and we'd still be screwed. We need 50 years of surpluses.

Re:Summary says it all (4, Funny)

jcr (53032) | about 6 months ago | (#45129891)

$16.7 trillion is not a partisan issue.

Bingo. The greatest enemy of the Ruling Party is math.

-jcr

Re:Summary says it all (1)

Aighearach (97333) | about 6 months ago | (#45129977)

The deficit could be zero and we'd still be screwed. We need 50 years of surpluses.

Not after you consider inflation. We can refi and choose our rate. ;)

Re:Summary says it all (5, Informative)

Anonymous Coward | about 6 months ago | (#45130341)

We need 50 years of surpluses.

People really have short memories. In the late '90s, there was concern by economists and financial analysts that the projected budget surpluses (surpluses) would result in the public debt being paid off by 2012. Paid off, zero, gone. The concern was that it wouldn't allow enough time for the markets to adapt to the end of the US Treasury Bond as the ultimate safe harbour. People were throwing ideas around for alternatives, in a world where the US would have no debt.

Then you guys elected GWB. Problem solved.

Re:Summary says it all (4, Interesting)

petes_PoV (912422) | about 6 months ago | (#45130155)

Thank George W Bush junior for destroying the trust in the US around the world

Actually, you can blame the russians. Before the USSR imploded there was another "power" that was able to keep the USA in check - if only with the threat of nuclear annihilation (though everyone knew there was far too much money at stake for that to ever happen). After that, the USA became far more aggressive and awarded itself the role of "global policeman", which basically meant making everyone fall in line with its view of how thongs (and things) should be.

What we're seeing now is that the policeman has far exceeded his authority and has also turned out to be power-crazed and financially impotent. It would be an easy job to simply ignore it, if it weren't for all those pesky nukes and vastly oversized (for it's own protection - verging on paranoia?) armed forces.

The only problem will be, that when the USA does get sidelined and does a "USSR" of its own, what will happen to the munitions? Being the heart of capitalism: selling to the highest bidder is inevitable.

Re:Summary says it all (1)

rufty_tufty (888596) | about 6 months ago | (#45130263)

One of the traditional ways out of these sorts of problems is to build up your military and go conquering.
Unfortunately that isn't going to work in this situation given the military is already the biggest both in actual size and proportionate size and there is no-one left to conquer who wouldn't do the economy more harm with the retaliation.

Re:Summary says it all (4, Insightful)

jfengel (409917) | about 6 months ago | (#45130241)

This is a problem that has been decades in the making. The Teapers and Bush II were the pointy end of a very, very long needle that goes all the way back to the founding of the country.

The problem is that Americans don't trust each other, and they never have. The battle lines here aren't all that different from the ones over which we fought a civil war. It was only an act of tremendous courage and foresight that let us even be a single country in the first place; the first draft essentially left us as a collection of weak, separate countries less closely bound than the EU.

America managed to prosper despite the fact that the country folk and the city folk seem to despise each other. They achieved it largely by ignoring each other, going on about their business and doing it very well, selecting their friends and associates. But as a world leader, we're required to work together, and our self-reliance turns into a weakness: we can't even be civil with each other.

The world can't rely on us, not as we are now. We've had better periods, when we established programs to look after each other, while keeping each other at arm's length by doing it through the federal government. These programs are the ones most under attack: national-scale programs are expensive and cause the deepest resentment. We end up fighting about them and hating each other all the more for it.

I don't know if any country can replace us. Our individualism has crafted the innovations that put us in this position. A de-Americanized world would advance a lot more slowly unless other countries can figure out how to do what we've done. But they may find that it comes at the same cost we pay of self-reliance becoming self-centeredness.

Re:Summary says it all (0)

gtall (79522) | about 6 months ago | (#45130343)

It won't be fraud that sinks the budget, it will be demographics. The Tea Party, and their fellow travelers, the Libertarians, want the Democrats to be responsible for reining in entitlements so that the Democrats get de-elected. Mind you they have the right idea that entitlements do need to be scaled back, but they are ball-less freaks about taking any responsibility for it. The other thing they want is less government because government does things they don't like such as environmental rules, etc... Put quickly, the fact that one single person defrauds the fed. gov. is enough to cut everyone off gov. assistance. And in their eyes, we do not have to worry about the environment because Jesus is just around the corner and will save them (not us) just before we completely bone ourselves.

However, most especially, Tea Party and the Libertarians, want to defund Science. The Tea Party wants to defund Science because it prevents the Tea Party from just making shit up without anything to compare to. And that hits the core of what it means to be a Tea Party member, the ability to think that if you believe something hard enough, then it becomes true...a bit like Dorothy is told in the Wizard of Oz, except they aren't in Kansas and they really do believe that. The Libertarians want to defund Science cause they believe that Science is done by geeky little people working in their garage and that it will magically spring forth unbidden to bestow untold riches upon the huddled masses. They also would like to sell you some swamp land in Florida if you have the cash.

Re:Summary says it all (1)

Aighearach (97333) | about 6 months ago | (#45129965)

The Slashdot summary already nicely shows why the Chinese do have a point of sorts

Sure, they have a point "of sorts," but what sort is it? The pithy, throw away sort. Their money coming in is mostly US dollars. Switching to the Euro, they'd lose money. They certainly can't push their own currency as the reserve, not while refusing to let its value float. And some new currency, who would support it that has so much more trust than the US, both in their financial honesty and ability to run the system, and also in their ability to defend themselves and their system? There is no such sponsor on this planet.

So clearly, China needs a deal with Mars.

Re:Summary says it all (0)

Anonymous Coward | about 6 months ago | (#45130245)

No country can be trusted not to inflate its currency. But you don't have to trust a country. Metals don't inflate easily...

Re:Summary says it all (5, Interesting)

mjwx (966435) | about 6 months ago | (#45130119)

The bit where the Chinese are IMHO wrong is that it will need any sort of centralised planning to achieve this replacement of the U.S. as hub of the global economy. That will just happen, inevitably.

Except the new hub will go to somewhere like London, Brussels or even Singapore. Delhi/Mumbai has an outside chance. Pretty much anywhere but China. Beijing simply doesn't have the trust from global businesses, of course they're all happy to take Chinese money, just not Chinese politics/philosophy. Maybe they'll go nowhere, the worlds economies are sufficiently distributed and communication is sufficiently fast that there isn't really a need to centralise it in a single location. Something happens in Bangkok, 30 seconds later Paris, Dubai, Vancouver and Adelaide know all about it.

The US is acting a lot like England of the 1960's and 70's. A waning empire still trying to convince itself of it's importance by talking about the good old days. The really bad part is, unless you change the road you're on you've got your own version of Thacherism to come.

News at 11 (-1, Flamebait)

Anonymous Coward | about 6 months ago | (#45129705)

Chinks and Gooks to Replace the Spicks and Spooks

Americanized World (0)

Anonymous Coward | about 6 months ago | (#45129713)

However all electronics, toys, whatever says "Made in China".

Re:Americanized World (1)

Aighearach (97333) | about 6 months ago | (#45130003)

You're either not an American, or don't have many toys. A lot of it says "Made in Taiwan."

Re:Americanized World (0)

Anonymous Coward | about 6 months ago | (#45130073)

Designed in Taiwan, Made in China, Marketed in USA.

Problem, reaction, solution.. (-1, Flamebait)

OhANameWhatName (2688401) | about 6 months ago | (#45129735)

the creation of a new international reserve currency to replace the present reliance on U.S. dollars

Wow! Didn't see that coming, how about everyone else in the world??

OMGoshness, US debt crisis constructed by US officials .. quickly! Hand power over to the UN, they can be the martial law for the whole world AND control all of the money. Anyone who thinks that this wasn't contrived is kidding themselves.

Re:Problem, reaction, solution.. (1)

mjwx (966435) | about 6 months ago | (#45129991)

the creation of a new international reserve currency to replace the present reliance on U.S. dollars

Wow! Didn't see that coming, how about everyone else in the world??

OMGoshness, US debt crisis constructed by US officials .. quickly! Hand power over to the UN, they can be the martial law for the whole world AND control all of the money. Anyone who thinks that this wasn't contrived is kidding themselves.

Dont worry, I think your entire post is extremely contrived.

international reserve currency (-1)

Anonymous Coward | about 6 months ago | (#45129747)

Call the world currency "Gold-Pressed Latinum" ("GPL") so we can all pretend we're living in the Good Future where everyone uses Free Software and LCARS --- instead of the Bad Future where America's #1 export becomes Soylent Green because America doesn't produce anything tangible except fat meaty people.

DOH. Because China's most likely to get screwed.. (5, Interesting)

theNAM666 (179776) | about 6 months ago | (#45129751)

The bottom line here is, the US owes-- as my economics professors (Reagan advisers) pointed out 25 years ago-- the one thing it can produce infinitely and with no cost: US dollars.

What happens in a meltdown? Well, if I ran the Fed along the principles my advisers taught me-- I'd pour payments to my allies (Europe, etc.); then I'd devalue the currency-- meaning, the creditors I didn't pay, now are owed much less. That's China, primarily, which, after all, has played quite a currency game with the US, and who's debt is quite arguably overvalued due to cheating on exchange rates.

Would China like the world to adopt the RMB as a default currency? Sure. Obvious. It's in their self-interest, at least. If everyone owes RMB, then they have to accept the global exchange rates.... they can't print or otherwise acquire USD, and pay off debts to China with the new currency.

Guess what? In short: no one's going to trust China as the global standard, as much as they aspire to it. If you're Switzerland, you know, that in a pinch, the US is going to pay off its debts to you-- not to China-- and give you a lot of notice, that it's going to devalue the dollar, so you can take advantage of the opportunity to erase 15% or 20% of your net debt to China, as well.

What's this called? Global political economics. China knows the game; it knows that it played the game to dump cheap labour and goods on the US, and accumulate capital debts (loans); and it knows, if the US reaches debt ceiling, it's China's debts that are going to get radically devalued to balance the sheets.

And good that. Unless, of course, you'd prefer that the Central Party, and not the US Treasury, is the final guarantor of the money you've loaned. A risk, I doubt, many of you (and many Central Banks) wish to take.

Or in short: the US will fulfill its obligations to allies and creditors who've played the game in good faith. To China and others who've gamed the system-- well, that's another story, and in the next days and weeks, we may very well see, what action the US can use, to re-balance the sheets.

Re:DOH. Because China's most likely to get screwed (0)

Anonymous Coward | about 6 months ago | (#45129807)

Hah, you're funny. The US is known for fucking one and all, allies and enemies alike.

Re:DOH. Because China's most likely to get screwed (1)

Aighearach (97333) | about 6 months ago | (#45130025)

Yeah, just ask the UK. Oh, wait.

If you mean the B-list "allies," yeah. They should have tried harder.

Re:DOH. Because China's most likely to get screwed (0)

Anonymous Coward | about 6 months ago | (#45129843)

>who's debt

please no.

Re:DOH. Because China's most likely to get screwed (5, Insightful)

palemantle (1007299) | about 6 months ago | (#45129845)

Or in short: the US will fulfill its obligations to allies and creditors who've played the game in good faith. To China and others who've gamed the system-- well, that's another story, and in the next days and weeks, we may very well see, what action the US can use, to re-balance the sheets.

I'm not seeing any evidence to support that. Going by recent history, the US seems perfectly happy to trample over its allies to secure its putative interests.

Re:DOH. Because China's most likely to get screwed (0)

Anonymous Coward | about 6 months ago | (#45130277)

bankcuprcy:
      -hide what you can from the feds.
      -pay the elites first (they can kneecap you)
      -pay your friends next (they might help you again later)
      -fuck the smaller suppliers
      -fuck the contractors
      -fuck the employees

GJ businessman, you get to start a new business thanks to your
great business skills at not paying back debts and running away from
failure.

Re:DOH. Because China's most likely to get screwed (4, Interesting)

gbjbaanb (229885) | about 6 months ago | (#45129849)

The unfortunate problem is that China owns all your dollars and doesn't know what to do with them. In fact all they can do is to float the Renminbi which would cause a collapse in the value of the dollar against it and basically crash the US economy.. and the rest of the world too. The US can't really follow your suggestion as the Chinese would kick off and do something once they saw it happening, I'm not sure what, but I could imagine nothing good overall. Probably crash the world economy in some way or another :-)

That they're trying to create something else suggests they're fed up with the US government lurching from crisis to crisis for wholely internal political reasons. And that a new inter-bank currency would allow them to spend all those dollars a little more easily. That's the main reason they want this, I think.

On the other hand, a first step towards a global currency is surely a small step forwards in human social evolution.

Re:DOH. Because China's most likely to get screwed (1)

Aighearach (97333) | about 6 months ago | (#45130085)

If they floated the renminbi US manufacturing stocks would go through the roof even while Wallyworld was liquidating. The value of the dollar would go up.

If the world economy crashed or not, or how badly, would all depend on the amount of warning.

There is no evidence of them trying to create something else; all there is evidence of is strongly worded newspaper editorials. We have those, too.

Re:DOH. Because China's most likely to get screwed (0)

Anonymous Coward | about 6 months ago | (#45130175)

1: China waged economic warfare with the US by pegging their currency; the fact spending their surplus leads to inflation devaluing the value of said savings below the purchase cost is a direct consequence of that decision. Nobody has any sympathy for them, specially the millions of Americans displaced from jobs by them.

2: The American Government is not representative of the people, we've been Jerrymander'd and interest group'd to death. We did not approve of the 2008 bailouts; The current government shutdown is a classic struggle between republican kickbacks to large medical companies (E.G. exemptions from Robinson Patman) and democratic kickbacks to the poor. What Americans really want is to can both, which, entertainingly enough, that act would make our socialist healthcare system solvent and every other countries socialist healthcare system insolvent overnight (Our prices drop 10x, their prices rise 10x). Congress is out of rope and has to choose sides and if they don't choose ours the country is done.

The Chinese are correct about THAT part but their government is an illegitimate socialist plutocracy. This is a government with literal death squads roaming the countryside (complete with organ harvesting) that employs 2 million thought police to patrol the internet. The Chinese Socialist party is seeing their international power wane because foreign countries view it as less costly to deploy scalar machinery and robotics in manufacturing rather than the cost of slave labor and concessions said party demands.

3: More to the point, the Federal Government disassembled the last Tea Party movement and the consequence is they've now radicalized the remaining dissidents. Those dissidents now march on capitol buildings en masse, armed (Funny how the guys in black ski masks don't show up to THOSE protests and begin starting shit...); they request sheriffs to write letters to the federal government telling them to stay the hell off the state's land, they request representatives write laws making the intrastate manufacture and sale of class 3 weapons legal. You can only say "everyone believes this just go away" so long until your delusional and alone. When those groups reach critical mass, and that will happen soon, the Federal government will be left without any tools to fight them; they have no legitimacy and the usual methods of breaking up disruptive protests are not going to work against an armed crowd.

Re:DOH. Because China's most likely to get screwed (5, Insightful)

jcr (53032) | about 6 months ago | (#45129899)

the US will fulfill its obligations to allies and creditors who've played the game in good faith.

Nope, not even close. The USA will default on those debts by inflation.

-jcr

Re:DOH. Because China's most likely to get screwed (0)

Anonymous Coward | about 6 months ago | (#45130169)

Nope, not even close. The USA will default on those debts by inflation.

You mean inflation is another form of default. That is, I print a trillion dollars to pay off the debt I owe you, now Good luck buying a loaf of bread!

Re:DOH. Because China's most likely to get screwed (4, Interesting)

aralin (107264) | about 6 months ago | (#45130051)

1) You assume that there is some unified entity called "US" that is able to act in its best interest. Clearly not the case.
2) You assume China's won't learn about the plan and if they learn they will not act.

In fact, very likely some Congresscritter would learn about such plan before it could even be executed, use it to criticize the president in public forum. As a response, China would immediately and quietly start to get rid of US dollars en masse, probably using some sort of derivative schema, which would hide it for some time. This would happen before US could even agree on any sort of plan. As it would become apparent in a couple months that China is dumping US dollars, it would simply dump the rest of them in bulk, causing the dollar to lose all the remaining value. Now all the US allies, those who didn't dump US dollars as well, are left holding useless currency and they lost on all the debt they were owed. They will demand US to repurchase all of the US dollars dumped on market to drive the currency back up. This is not gonna happen. US will be facing a lot of angry countries demanding some sort of reparations. All the US foreign trade will cease immediatelly. The fact that US is not self-sufficient in almost any area and the US dollar being worthless will start draining the country of all its natural resources, because that is the only thing they can use to pay for what they need by now. In another 10 years, US would be a shell of a country. At this point US will use their only remaining option and declare war on China and use their military to shore themselves up economically. But at this point US has no allies and no goodwill at the UN. The result is a war of US against the rest of the world.

So good luck with your brilliant economic plan. Your advisers had to be some brilliant thinkers.

Re:DOH. Because China's most likely to get screwed (1)

Aighearach (97333) | about 6 months ago | (#45130053)

I love a late-night splash of Realpolitik!

The only thing I disagree with is that it would be in China's interest if everybody switched to the RMB. In 15 years, maybe. Once their domestic economy is strong enough to fill those ghost cities, they'll be in a position where it would help them. Right now, they'd lose the farm; the RMB would rise until it hit market value, their manufacturing would crash, then people would start trading it for Dollars and Euros, and they'd be powerless to keep control of it.

I don't think their position here is that serious at all. They're just making throw-away noises for domestic consumption. And their real fantasy is that Europe would relax protection of key industries, and go "cheap imported" like the US. Then they'd have enough euros coming in to want that to be the global reserve.

Now there's your problem (1)

Anonymous Coward | about 6 months ago | (#45129757)

Petrodollar is the root cause of corruption on a global scale.

China has been backing the usage of ADR .. (0)

Anonymous Coward | about 6 months ago | (#45129765)

Has been for quite awhile, but of course there's much political pressure against using it from the US and somewhat from the EU...

They are right, but (5, Interesting)

Anonymous Coward | about 6 months ago | (#45129777)

They are right, the world needs a better currency. Preferably one not regulated by nation states or corporations: maybe bitcoin or a descendant with its flaws fixed. Also certainly the `voracious Wall Street elites have their role in the current crises (plural).

However, the real problem is all of us: run-away consumerism. The masses who took irresponsible mortgages. The `need to replace a perfectly good smartphone every two years. The throw-away society.

The economy is based on debt, and every nation is either involved in the race to the bottom for all the planet's natural resources, or they want to get into the race.

China is _not_ going to be the saviour though, also not Russia, India, Europe, South-America or the USA.
It is time to face the truth: this system cannot be saved, it can only collapse.
The quicker it goes, the better, because every day that goes by the damage caused grows bigger. There is no point in trying to hasten it (like Anonymous does sometimes), all energy should go into prepare for a rebuild.

If there is to be a new world order, whatever shape it might take, it must be build bottom up, by the people.
Capitalist-alike, but without the corporations.
Socialist-like, but not with the top-down planning and represssion.
Open sourced and based on spontaneous collaboration, but without the hippy navel gazing.

Therefore it is essential to keep the Internet free, and running whatever else in the world may go down.

It is the major advantage the world has to prepare for a soft landing, when the world order crashes.

-- a PIrate Party member who wishes to stay anonymous.

Re:They are right, but (2)

xQx (5744) | about 6 months ago | (#45130147)

They are right, the world needs a better currency. Preferably one not regulated by nation states or corporations: maybe bitcoin or a descendant with its flaws fixed.

Okay, I'll bite (because I might learn something).

What are the flaws that need to be fixed in bitcoin, and given the world adopted democracy, Microsoft windows, and Keynesian economics despite their flaws, what makes you think bitcoin won't be accepted despite its flaws?

No real reserver currency alternatives (5, Insightful)

Dorianny (1847922) | about 6 months ago | (#45129783)

China and many other nations would love to see another currency supplant the U.S dollar or at the very least have a credible alternative, but the truth is that currently there is no currency that could do that. The Chinese renminbi is not free floating, the euro is not even guaranteed to survive, Japan is too leaden with debt which puts into question the future stability of the yen, and finally the British sterling, Canadian or Australian dollars etc are simply backed by too small of a economy to be considered serious contenders.

Re:No real reserver currency alternatives (0)

Anonymous Coward | about 6 months ago | (#45129827)

RTFS they want to make a new international currency, not use an existing one. How that could actually work I have no idea (backed by what?).

Re: No real reserver currency alternatives (3, Informative)

chill (34294) | about 6 months ago | (#45130083)

Google "special drawing rights" or "SDR" to learn about how, who and why.

Easier said than done... (5, Interesting)

slew (2918) | about 6 months ago | (#45129787)

The institutions that emerged (world bank, IMF, UN) were really just codified the result of WWII. The likely reason nothing has emerged to replace it is that we haven't had WWIII yet.

It might be interesting to speculate how all this could change w/o fighting another world war, but it seems unlikely given the inertia of the current institutions.

On the currency issue, I think most of the people that talk about a non-us-dollar reserve currency are totally unaware of the history of the Bank for International Settlement and the IMF which denominates their reserves in SDRs (special drawing rights) which is a weighted basket of currency (USD, Euro, Yen, and British Pound).

The problem with any kind of currency reserves, is that countries need to be willing to put up significant assets to back up any denomination of wealth (or you might find them being attacked like George Soros once attacked the British Pound). The one thing about the USD that's hard to substitute is that it's really hard to attack it now as there are many greenbacks out there and many contracts are denominated in USD. Any transition to an alternate reserve is likely to be attackable which means it must be very quick or as part of a big movement (perhaps even war-like).

Sigh (2)

cayce (189143) | about 6 months ago | (#45129803)

These attempts of China to flex their metaphorical muscle is just more fuel for the US conservatives to keep justifying the idiotic defense budget and the "World Cop" ideology.

How did the Mongols defeat the Chines (-1)

Anonymous Coward | about 6 months ago | (#45129831)

They bribed the officials on the wall. History turns full circle. Here in the USA our officials have received campaign donations in the form of brown paper bags full of USD in return for giving them most favored trading status. The Chinese have financed our endless war while they have been building their own country and infrasture. I say we should ship our traitorous leaders over to the PRC. Fuck China. Let's go into default on our loans to China. Let's ship them some nuclear weapons instead. Why the fuck is the USA fighting everyone in the world (including ourselves) when the real enemies Mexico and China are completely ignored. Seriously the the Chinese (who own the major media outlets) have done a really excellent job of brain washing us.

Fuck China
Fuck China
Fuck China
Fuck China
Fuck China
Fuck China

Don't have a job. Blame the Chines, and the greedy executives who shiped everything overseas.

Fuck China
Fuck China
Fuck China
Fuck China
Fuck China
Fuck China

Fuck China
Fuck China
Fuck China

Now some of you magnimous liberal Chinese appoligists are more than likely to say I hate China. But on the other hand. The Chinese (in the OP) have no problem laying shit on the USA. I am just turning it around and supporting my country as opposed to being all magnanimous and taking all the shit that the Chines have no problem giving us.

Remember billions of Chines are working day and night to ensure that you and your children have no future. The only hope is for us to come together work hard and and defeat the enemy. You laugh, but China isn't laughing, and at the end of the day they won't be giving us any quater.

Fuck China
Fuck China
Fuck China
Fuck China
Fuck China
Fuck China

It's starting (5, Informative)

Animats (122034) | about 6 months ago | (#45129869)

China still has substantial currency controls on the renminbi. It's difficult to move renminbi to other currencies. There's a "State Administration of Foreign Exchange" which issues permits to do that. Businesses and individuals in China can buy goods with renminbi from other countries, but exchanging renminbi for dollars or euros or doing other cross-currency financial transactions is heavily controlled.

(Lately, there's been a surge in Bitcoin transactions in China. This provides a way to get around exchange controls. This activity will probably provoke some government action if it gets big.)

Because of those exchange controls, the renminbi has not been a major international currency. That was the deliberate policy of the People's Bank of China for years, because they didn't want their internal economy yanked around by external events. That policy changed in July 2013 [wsj.com] . China now has a big enough economy internally to outweigh external holders.

Retail controls are loosening. HSBC and Standard Chartered Bank will now let you open a bank account outside China denominated in yuan. But it's not freely exchangeable yet.

Here's a summary of "Circular Concerning the Simplification of Cross-Border RMB Procedures and Improvement of Relevant Policies" [china-briefing.com] from the People's Bank of China. The changes are slow and cautious, but are happening.

Re:It's starting (1)

Aighearach (97333) | about 6 months ago | (#45130129)

Thanks for that info, but while they're loosening the controls on Chinese banks, there is no indication that they are going to allow more movement. They are, as they say, simplifying the procedure. Now that the internal economy is strong enough to hold its ground, they can switch from a tight military style control, to a regular regulatory system (backed by the threat of execution). More of the process can be done without prior approval now. So for Chinese bankers that is a big improvement. But that doesn't imply that the rules over when it is okay to make a transfer have changed at all; only the process has changed.

I honestly can't blame them for making a 'plan B' (1)

Chrisq (894406) | about 6 months ago | (#45129909)

These carryings on in Washington won't themselves lead to the loss of US power. What will though is if this becomes an accepted political tactic. Republicans win the white house and pass a law that the democrats don;t like - they do the same and hold the country to ransom. This could lead to a slow decline and long-term instability of the dollar

Western democracy is at an end (4, Interesting)

SmallFurryCreature (593017) | about 6 months ago | (#45129911)

The US is hardly alone in its trouble. The Netherlands just had "prinsjesdag" the day that the budget for the next year is presented. And it was immiedialty followed by a not yet ended dance to get enough approval from non-governing parties to get it through both parlements. Because the two coalition parties don't have a majority in both. No it isn't a two party system, we got LOTS and it isn't exactly a deadlock but it does result in a compromise that nobody hates and several government in succession that haven't finished their terms. This government likely won't make it either.

The Belgians recently spend a year without a government because the sub-frenchies and the sub-dutchies hated each others guts. England is being ruled by two parties where one party is withering away because it gets the flack for supporting the other party. What people are going to vote in the next election is anybodies guess. Maybe they will punish the tories again by voting labor.... because voters never ever learn (that is how labor got in to power in the first place, only for blair to upset people so much they voted tory to punish labor).

Germany too has seen the collpase of a coalition with one party not even making the voting treshhold. To Merkel is look for another party to rule with so that party too can lose all their voters... sounds like a good plan right?

Southern Europe mostly votes for whatever guy promises the most and blames all the wrongs on nothern Europe for refusing to subsidize the south after decades of subsidies that were squandered.

Canada hates its leader but refuses to elect anyone else. New Zealand is a puppet state and Australia seems to elect people the people online hate.

The problem might be that elections are simply to simple a tool to decide with how to govern a country.

Take for instance privacy. One privacy issue that Americans often mention is their medical history since an insurance agency might reject you if they know you have ill health. But Obamacare cures that. If an insurance agency can't reject you for your medical history, neither will they want to find out your medical history. Bam! Socialism saves privacy! How is that for a twist? Every privacy freak support Obama!

A bit silly perhaps but this shows that issues don't stand alone yet during elections they are presented like they are and most elections boil down to a handful of issues and then everybody bitching about how party X who promised Y is not doing Y and totally screwing you over on Z as well.

Or maybe democracy is alright and it is just needs a better class of human beings.

But the US is not alone in being screwed up and suffering gridlock. It is just dealing with it in the most immature way possible. But hey, that is Americans for you and we love them for it. Makes for an entertaining way to end the news, first 10 minutes of how your own country is falling apart, then a 1 minute "silly yanks" bit to show that no matter how silly your own leaders, there are sillier people on this planet.

USA, showing the world things can always get sillier!

Re:Western democracy is at an end (0)

Anonymous Coward | about 6 months ago | (#45130133)

and Australia seems to elect people the people online hate

Australians?

Re:Western democracy is at an end (3, Interesting)

geogob (569250) | about 6 months ago | (#45130187)

Just a quick word from a canadian living in Germany...

The issue with Canada is not that the citizen do not vote for other parties or politicien. The issue is that, due to the electoral system, a party can get the majority of the seats with less than 40% of the popular vote. So in fact, Canadian chose to vote for someone else, and, quite ironically, because of this popular decision, the conservatives were promoted from a minortiy government to a majority government.

In Germany, the politcal and electoral system is quite different. But your assessment that a coalition colapsed is quite far from what is going on here. Yes, one of the coalition parties was trown out. The conservatives (which is quite a relative word when compared to the canadian conservatives or, *gasp*, the american conservatives) were already quite strong after the last election and could build a coalition with one of the smaller parties, the liberals, which allowed them to achieve the majority in the Bundestag. Since the last election, the liberals had been acting like assholes and showed themself as lobyist mor than liberals. They also failed to pass their only real electoral promess of reducing taxes, which was the only reason why people voted for them in the first place. All thing considered, it shouldn't surprise anyone they got thrown out. Even the conservatives told their electorate to give their two votes (in germany, you vote for a direct mandate - someone representing your county - and a seconde vote, where you vote for a party. The liberals only got seats through this seconde popular vote) to them. Basically, the the coaliation leader campaign against their coaliation partner.

So saying that the coaliation collapsed is a bit strange in this context. The conservatives got almost all everything back what the liberals lost and ended just under the majority. Of course, they lost this hand and now must either build a coaliation or a minortiy government (which is unusual).

But I would say that democracy is very healthy here compared in a lot of places in the west. Of course, the economy, infrastructures and the social structure are in very good shape in Germany, what helps for stability.

Oh Yeah, we're headed for exciting times (0)

Anonymous Coward | about 6 months ago | (#45129937)

+1

I feel really insecure with Australia's agreements as it is. meaning, The FTA and US millitary bases on Aussie territory.

The US don't help me feel safe. My father was in the millitary.

The Chinese have long (about a hunderd years) been wary of the US and it's cronies raping and pillaging in the guise of religeous wisdom.

I'm for the change, let's get out of here.

My 2cents

China can stick their BS (-1)

Anonymous Coward | about 6 months ago | (#45129989)

" 'The world is still crawling its way out of an economic disaster thanks to the voracious Wall Street elites."

No, its crawling its way out of a mess caused by leftist interferance in commercila activities -- forcing institutions to go against common sense and previously normal procedures (ie- forcing loans upon banks to giveoverpriced homes to people who are not likely to be able to pay for them when an economic downturn occurs). It is also not 'wall street' who is printing money and racking up debt like crazy to pay for wasteful leftist programs and buying votes from people on the dole.

China and the other commies best look to their own houses before casting their BS at others.

Re:China can stick their BS (1)

Dr_Barnowl (709838) | about 6 months ago | (#45130191)

The banks LOVE mortgage debt.. it lets them dream up money. Don't tell me that they didn't lobby for all those changes.

* It's entirely backed by assets, thus it's much less risky than loans to business

Unfortunately, once a house is a house, it's a house. It's not going to be more of a house next year. They don't increase in actual real value, but their price goes up.

If you lend to a business, you have to contend with the idea that your money may disappear entirely and you may never recover it due to bankruptcy law.

* It provides capital growth with no investment or effort

Because property values go up, the banks can invent more money, again "risk free".

Banks LOVE (and lobby in favour of) government programs that encourage house buying because it gives them a license to print money, which equates with power.

Because of Congressional squabbles (1)

maroberts (15852) | about 6 months ago | (#45130015)

The US is teetering on the brink of loosing its right to be a Reserve currency. If that happens we're all likely to be trading in Renminbi,

I think Congress should change the law so that the fiscal limit is be automatically increased by (say) 5% each year unless a bill is passed for a different amount. That would prevent a party having a chokehold as preventing an increase would need to pass both houses and get presidential approval.

When did we force the world to use our currency? (0)

TomGreenhaw (929233) | about 6 months ago | (#45130059)

The world has always been free to do what it wants. In the past, the US was a logical choice because of the size and stability of our economy. It seems to me that anybody who really believes in free trade would welcome a worldwide currency. I think the US would be fine with purely capitalist markets setting the exchange rates - would everyone else be OK with that?

Petrodollars (4, Interesting)

robbak (775424) | about 6 months ago | (#45130111)

The US has gone to war a number of times (it is claimed) to prevent countries trading oil in currencies other than the Dollar. Some of those claims might border on conspiracy theories, but it remains that the tactics to keep oil trading based on the U.S. Dollar look remarkably like 'force'.

Etymology note: Petroleum is latin for 'Rock Oil' (Petra, rock + Oleum, oil, from the Latin for Olive.). When we created that abbreviation, Petrodollars, dollars for oil, all that was left of the oil was the 'o'. The word looks more like 'Rock 'o Dollars, doesn't it?

What to do with U.S. stockpiles of bombs? (1)

HansKloss (665474) | about 6 months ago | (#45130087)

Wishful thinking on the part of China. U.S economy is based on military industry well-being. What they suppose to do with warehouses full of weapons?

Notice the constant pressure by administrations to invade country after country to unload those bombs.
Recent Syria events are not helping either, warehouses are overflowing and we can be sure they will find a new target.

All empires rise and fall (1, Interesting)

Anonymous Coward | about 6 months ago | (#45130173)

The US economic empire is no different from any of it's predecessors.

i would go along with it except (2)

FudRucker (866063) | about 6 months ago | (#45130311)

china's products that they flooded the world markets with is of such poor quality and made with such poor material and terrible workmanship that i would rather see china embargoed until they start building products better

All ideological and rhetorical word-whoring aside (1)

vikingpower (768921) | about 6 months ago | (#45130327)

this sounds like a good idea. But then please not with China as the new superpower. I want to live in a world composed of many smaller, financially well-equilibrated states, without superpowers.
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