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Will China shake the world again?

Discussions about the economic and financial ramifications of PEAK OIL

Re: Will China shake the world again?

Unread postby americandream » Wed 19 Feb 2014, 20:33:53

Sixstrings wrote:
americandream wrote:The "we" that matter in America own most of its wealth and steer government policy. You can huff and puff all you like, this will not alter things one iota.


True enough..

But if it costs $20 for bread becasue China seriously dumps bonds and say we've pissed off the Europeans and say we've let Japan twist in the wind and they're not friendly with us anymore either, and we done lost the Saudis a long time ago..

Then standing in the Walmart looking at that $20 loaf of bread I'd be in that "we" too, as far as consequences go. I don't like the 1% and banksters in charge either, but I know the realities here, and I have US dollars in my pocket and I know what could happen to their value if the paradigm gets screwed up.


The bonds are nothing. The real connection is in the trillions of American FDI and the wealth it generates for the rich. You tax dollars are small change and were possibly dumped for reasons more related to the FDI interests than a government spat. Remember, it was American money that turned an agrarian China into the world's factory.
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Re: Will China shake the world again?

Unread postby Keith_McClary » Thu 20 Feb 2014, 01:05:24

Sixstrings wrote:But if it costs $20 for bread because China seriously dumps bonds
Bread doesn't come from China. Maybe these will cost $20 :
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Re: Will China shake the world again?

Unread postby Sixstrings » Fri 21 Feb 2014, 16:57:36

Keith_McClary wrote:Bread doesn't come from China. Maybe these will cost $20


If China seriously dumped US bonds, and other central banks and sov wealth funds did not buy them, and, if the world moved away from US dollar reserve too quickly..

Then that would be a massive devaluation of the US dollar, and bread and everything else would cost a lot more.

I just hope someone smart is always on top of this stuff, because with globalism we are *financially vulnerable* every bit as much as the just in time global supply chain system.
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Re: Will China shake the world again?

Unread postby EdwinSm » Mon 24 Mar 2014, 06:19:04

"Slow down you move too fast, you got to make the oil last.... [smilie=eusa_boohoo.gif] "

China's manufacturing sector showed further contraction in March, according to a new report which mainly tracks activity in smaller factories.

The HSBC Purchasing Managers' Index (PMI) gave a reading of 48.1 for March, compared to 48.5 in February.

A reading below 50 indicates contraction, while one above 50 shows expansion.

The HSBC survey focuses on smaller companies in the private sector.

China's official PMI survey, weighted more towards bigger and state-owned enterprises, will be released later this month.

....
China's exports also dropped 18% from a year earlier in February, leading to a trade deficit of $23bn (£14bn) for the month.
....


http://www.bbc.com/news/business-26710807

Manufacturing contracting...exports dropping..a trade deficit... None of that sounds good for the world economy, but the sliver of silver lining for the cloud might be less oil used.
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Re: Will China shake the world again?

Unread postby Pops » Mon 24 Mar 2014, 07:44:26

Sixstrings wrote:
Keith_McClary wrote:Bread doesn't come from China. Maybe these will cost $20


If China seriously dumped US bonds,

You keep saying this, who are they going to "dump" them on?
What currency are they going to take for payment?
And why, pray tell, would they "dump" them and watch their investment fall to nothing?
. . . and their biggest customer go broke?
If destruction be our lot, we must ourselves be its author and finisher. As a nation of freemen we must live through all time or die by suicide.
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Re: Will China shake the world again?

Unread postby americandream » Mon 24 Mar 2014, 13:28:07

Pops wrote:
Sixstrings wrote:
Keith_McClary wrote:Bread doesn't come from China. Maybe these will cost $20


If China seriously dumped US bonds,

You keep saying this, who are they going to "dump" them on?
What currency are they going to take for payment?
And why, pray tell, would they "dump" them and watch their investment fall to nothing?
. . . and their biggest customer go broke?


Pure logic.
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Re: Will China shake the world again?

Unread postby Tanada » Mon 24 Mar 2014, 14:35:33

Pops wrote:
Sixstrings wrote:
Keith_McClary wrote:Bread doesn't come from China. Maybe these will cost $20


If China seriously dumped US bonds,

You keep saying this, who are they going to "dump" them on?
What currency are they going to take for payment?
And why, pray tell, would they "dump" them and watch their investment fall to nothing?
. . . and their biggest customer go broke?



The classic answer to part one is they tell the Federal Reserve quietly that they want to unload X number of US Treasuries and offer them the opportunity to buy them with foreign exchange holdings of the US Federal Reserve. I don't know how many Euro's, Rubles, Juan, Yen and so on the Federal reserve holds but it is a big number and doing this kind of a deal would be in the interest of both the Chinese and US Government. It protects the value of the Dollar and at the same time lets China divest from Dollar funds.

Clearly China has not done this at this point in time, until it happens there is little risk to the Dollar because they are just as tied too it as everyone else who owns Treasury bonds.

The classic answer to part 2 is, by doing part 1 in a reasonably competent fashion their #1 customer stays in the buying business, but at the same time they limit there exposure to the next USA downturn.
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Re: Will China shake the world again?

Unread postby Pops » Mon 24 Mar 2014, 14:59:19

Tanada wrote:The classic answer to part one is they tell the Federal Reserve quietly that they want to unload X number of US Treasuries and offer them the opportunity to buy them with foreign exchange holdings of the US Federal Reserve. I don't know how many Euro's, Rubles, Juan, Yen and so on the Federal reserve holds but it is a big number

Looks like China holds $1.273 trillion in chits and Uncle Sugar has a paltry $146 billion in the cookie jar - including the cookie jar.

I think, I could be reading those numbers wrong:
http://www.treasury.gov/resource-center ... 42014.aspx
http://www.treasury.gov/resource-center ... ts/mfh.txt
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Shanghai Oil Futures Off To Robust Start On 2nd Day

Unread postby AdamB » Wed 28 Mar 2018, 20:56:00


Shanghai crude oil futures got off to another strong start in their second day of trading on Tuesday, with more than 16 million barrels of crude changing hands, extending the launch day's high volumes, data showed. More than 32,000 lots of the most-active September contract, equivalent to 16 million barrels of crude, changed hands in the overnight and morning sessions. Over the first 24 hours of trading, Shanghai's spot crude volumes made up 5 percent of the global market, compared with 23 percent for Brent crude futures and 72 percent for the U.S. West Texas Intermediate contract. Brent volumes have been lower than usual as much of Europe is already on holiday for Easter. By 11:14 a.m. (0314 GMT), 3,599 lots of the most-active June contract had traded, equivalent to 3.6 million barrels of crude. At 0316 GMT, Shanghai's September contract was down 1.43


Shanghai Oil Futures Off To Robust Start On 2nd Day
Peak oil in 2020: And here is why: https://www.youtube.com/watch?v=2b3ttqYDwF0
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Re: Will China shake the world again?

Unread postby jedrider » Wed 28 Mar 2018, 21:59:47

Can we just go on pretending a little longer because I haven't retired yet? Maybe 10 years more? Then, I'll ask for another extension anyway when the time comes. I think it's in everyone's interest now to keep on pretending that the world's financial system is solvent and will stay solvent, by hook or by crook ;-) I bet you it will be crook in the end, though.
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Re: Will China shake the world again?

Unread postby onlooker » Fri 30 Mar 2018, 18:47:08

jedrider wrote:Can we just go on pretending a little longer because I haven't retired yet? Maybe 10 years more? Then, I'll ask for another extension anyway when the time comes. I think it's in everyone's interest now to keep on pretending that the world's financial system is solvent and will stay solvent, by hook or by crook ;-) I bet you it will be crook in the end, though.

Well confidence is a bedrock requisite for the Stock Market to keep humming along
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Re: Will China shake the world again?

Unread postby dissident » Sat 31 Mar 2018, 00:01:02

jedrider wrote:Can we just go on pretending a little longer because I haven't retired yet? Maybe 10 years more? Then, I'll ask for another extension anyway when the time comes. I think it's in everyone's interest now to keep on pretending that the world's financial system is solvent and will stay solvent, by hook or by crook ;-) I bet you it will be crook in the end, though.


Actually you hit on the essence of the current state. The global economy is riding on a vapour cloud of perception. Psychology has always been a central element of economics (hence its voodoo science nature). As long as the fake stream media can keep all the sheeple deluded, this lead balloon keeps floating. But such a state is metastable and by definition can undergo a destructive instability as the underlying fundamentals kick in sooner or later.

I wish that the current state were stable, that would be in my best interests, but I know that it is not. There is a mile high tsunami of pain heading our way and we can do nothing about it.
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In Unprecedented Move, China Plans To Pay For Oil Imports Wi

Unread postby AdamB » Sun 01 Apr 2018, 18:21:02


Just days after Beijing officially launched Yuan-denominated crude oil futures (with a bang, as shown in the chart below, surpassing Brent trading volume) which are expected to quickly become the third global price benchmark along Brent and WTI, China took the next major step in the challenging the Dollar's supremacy as global reserve currency (and internationalizing the Yuan) when on Thursday Reuters reported that China took the first steps to paying for crude oil imports in its own currency instead of the US Dollars. A pilot program for yuan payment could be launched as soon as the second half of the year and regulators have already asked some financial institutions to "prepare for pricing crude imports in the yuan", Reuters sourcesreveal. According to the proposed plan, Beijing would start with purchases from Russia and Angola, two nations which, like China, are keen


In Unprecedented Move, China Plans To Pay For Oil Imports With Yuan Instead Of Dollars
Peak oil in 2020: And here is why: https://www.youtube.com/watch?v=2b3ttqYDwF0
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