Cite please?

I think he's referring to the fact that China has bought a large share of the US government bonds used to finance the military.

Bingo!

China has long believed they were being helpful by returning boatloads of dollars to America by buying US government bonds. Unfortunately, this has further made Cheney, et al feel that massive deficits don't matter. If China did not buy so much American debt, then Cheney, et al would have to come to grips with a government without cash.

Well, the Highway Trust Fund has already been so depleted and having trouble meeting next month’s payments. States are complaining that Highway fund payments are no longer arriving in a timely manner. Even with China, et al massively buying American government debt, the government was still having cash flow problems in some locations. What happens if foreigners stop financing the George Jr administration? Well what do we stop funding? Infrastructure and education - or troops on the other side of the world?

The reason that George Jr (Cheney) could spend like drunken sailors? China, et al made Enron style accounting appear to be balanced. Without China, et al, the American government could not spend $2 trillion to bail out Wall Street.

Really, is that what the final tab will be? :mad:

It's currently just under $1trillion. This is what happens when accounting standards and regulation enforcement change to make Enron, et al acceptable and when government throws money at elite member of the economy (ie tax cuts, welfare to Halliburton) to make the economy look good.

Why not just pay everyone to rip up and replace their front lawn every year? It would have accomplished this same thing but made the little people richer.

BTW, the stock market goes down the year after a new Republican president gets elected. It happens every time. Can things get worse?

They can always get worse.

bold text mine

My question is, and I am starting out professing I am no expert on this subject, what happens when China calls in the loans? Are we really immune to a takeover? Will China own us?

Also, why did everyone in the know walk around with their heads up their asses until the crisis got THIS BAD? :mad: Why is this typical of the Bush administration? Until things hit rock bottom, they're counting birds in the sky or something.

I am less of an expert than S123,
What has congress done about anything - anything at all - anyone?
Oh thats right - they went on ANOTHER three week vacation.

They are not loans. For example, when America was on the verge of fiscal responsibility, we stopped selling 30 year bonds. But now that we must mortgage America's future to pay for fiascos (ie tax cuts to the rich, 50% of companies paying no taxes, “Mission Accomplished”), the Chinese, et al are buying America’s 30 year bonds.

Bond's are not mortgages. A bond promised to pay the holder years or decades later. However, China can choose to sell those bonds to others.

A more serious problem is so many American dollars held in overseas banks. What happens if the world decides to no longer buy oil in dollars? Suddenly the dollar has even less value. What happens when countries such as China fear the American dollar is overvalued? They dump dollars causing same problems.

Some say the lower dollar creates more American exports. They also forget that most of those exports are dependent on imports that would cost more. What would result is massive inequities in the American economy as businesses constantly change prices or scramble for new suppliers or customers.

Confused? Well it gets even more complex. This is only a snapshot of chaos should the American economy suddenly have less value to foreign dollar holders.

Those maybe three American companies every week being sold to foreigner? Just like in the 1970s, America had to sell itself to pay for the party and resulting hangover. Back then, the world's third largest industrial base was American owned foreign industries. We had to sell them off to pay for our fiscal mismanagement. What do we sell off this time?

Snapshots of what might happen. Appreciate why deficits do matter after Cheney is long gone. Many will forget to blame the economic hardships on Cheney just as so many forgot to blame Nixon and other bad management in 1979.

Thank you, tw. I appreciate the explanation; I know it is a complex issue but even with limited knowledge I know it is a very scary situation.

Speaking of Cheney, I must read "Angler" by Barton Gellman.

The depths of evil have reached some proportion, eh?

I don't believe for one whit that they were clueless. In fact, I believe that they knew the risk (of deregulating the games that helped to create this mess) and had this back-up plan ready to go. Wall Street is so deeply embedded in our government that they feel they can pretty much do as they please.

I am in no way whatsoever an expert on these matters. This opinion is just my gut reaction. But tell me...when they started to dish out thousands of ARM's to low income people, didn't they know what was going to happen? That must be why these 'assets' were sold off so quickly.

Absolutely. Note the "in the know" portion of my post. They chose to walk around with their heads up their asses and only acknowledge any problems when it has become so big that even the typical non-financial American notices it's effed up. They KNEW KNEW KNEW they would get bailed out no matter how badly they effed it up. Fuck the rest of us, is exactly what happens.

Yup, I was agreeing with you...:)

(Just sayin just in case)

:)

I know, I was just making sure, but also re-vamping my rant. I love a revamped rant, don't you? :)