Approaching The Global Economic Crossroad

[uncleyap]

http://uncleyap.blogspot.com/2009/03/approaching-global-economic-crossroad.html


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Approaching The Global Economic Crossroad









In the last 2 centuries the world saw 2 major forms of economies - Communism vs Capitalism.

Undoubtedly communist giants Soviets & China had moved from communism towards capitalism, since Gorbachev & DengXiaoPing, until present. What I want to point out is that Obama & today's USA is moving the Capitalism World towards Communism, this is shown by Obama's present policies and his CHANGE campaign.

As it is, Obama govt is interfering against Capitalism's Market Economy bailing out private corporates with huge tax payers funds, and intervening with Business Management in e.g. executive salaries & bonus. Without arguing about these acts and just viewing them purely as facts, injecting trillion dollars of state funds into major corporates and politically managing them are essentially features of Communist Regimes.

The end results in Free Market Capitalist Corporates goes towards becoming state-owned and state-managed Corporates - AIG & Citi Corp & GE & Ford becomes the like of famiLEE LEEgime's Temasek GIC GLC GRC. As it is in Obama's hands these Private Business Corporates had become the WhiteHouse's liability and tax payers' burdens, as the trend is developing and intensifying towards the direction of Communism Economy.

Besides capital and managment, the same trend is adopted in the labour and employment aspects. Governments other than USA within the capitalism world are mosting fighting against unemployment by initialing large scale national projects, Stimulus Plans or Resilience Package whatever they called them, are in nature so similar with Soviet or PRC's Communist Economic Schema or mark-out projects. The US Govt's issuing of Food Stamps and poor citizens lining up at Soup Kitchens are not in nature any difference from comparable Bread Lines in the ex-Soviet.

I want to point out that the world is at a really major crossroad at which Communism & Capitalism are meeting at the same point. Both communism and capitalism are losing their original features and adopting the feature of each other.

The irony had shown up that roles and positions switched between Communist & Capitalist worlds, where those used to be rich became poor and those used to be poor become rich. Those who used to be failures and laughing-stocks switch with those who used to be successful and contempt.

In the key transition from Communist Soviet to Capitalist Russia it was Gorbachev's Perestroika. In the key transition from Capitalism USA to whatever the future they become, here is Obama's CHANGE.

Gorbachev's Perestroika drastically altered the Warsaw Pack Eastern Block e.g. East Germany; Poland; Romania; Yugoslavia; Hungary; Khasakistan; Ukraine etc. Obama's change will affect NATO & G8 & many other countries, in significance and meanings and scale comparable to Gorbachev's Perestroika, this is foreseeable from my point of view.

At this Global Crossroad, both the communism and capitalism worlds will trade economic features and strategies, their people will exchange their experiences from their own histories, they may also trade their feuds and spark World War III in the process, however at the ending they will understand each other better. It is a major lengthy reaction and process in world's history.

What I have yet to figure out is about the aspect of Freedom. So far it seemed that people from the ex-communist states are enjoying more freedom after their countries' transition towards capitalism, it is yet to be able to figure out weather the freedom of people will suffer as their capitalism states moves through depression towards communist colored future.

Lets wait and see and I am sure there are things to be learned.











posted by uncleyap at 5:38 AM






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[uncleyap]

As I am writing, Obama in the news is carrying and petting his auto-maker-babies, which are crying financial death. This is highly unusual for a US president to be using US tax payers resources and White House attention into any Free Market Economy private business corporations' finances; capital & management. Exactly, what Obama is doing is the role of Communist Governance performing State Equity Participation; Statutorial Governing; and Political Managment into commercial sectors affairs - a key feature of Communist Economies!

It is highly unusual in USA as a Capitalism Empire. Such thing are rather normal for Moscow or BeiJing Governments in the eras 2 decades ago however, to be performing State-Run businesses & political regulations & providing tax-payers' funds to bail-out dying state-own businesses.

http://sg.news.yahoo.com/afp/20090329/tts-finance-economy-us-auto-sector-publi-972e412.html

<cite class="auth">AFP - Monday, March 30</cite> US President Barack Obama, seen here on March 27, said the US automakers needed to do more to restructure their ailing industry to win billions of dollars in extra government funding.


<form class="sch" action="/search/" id="ynw-s1" name="search" method="get" target="_top"> <input name="yahoo_search" value="Yahoo! News" type="submit"> <input name="web_search" value="All the Web" type="submit"> <input name="fr" value="news_sb_hd" type="hidden"> <input name="prop" value="sg" type="hidden"> </form> Obama warns automakers to do more


<cite class="auth">AFP - Monday, March 30</cite>WASHINGTON (AFP) - - US President Barack Obama said Sunday the US automakers needed to do more to restructure their ailing industry to win billions of dollars in extra government funding.



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Asked if General Motors and Chrysler needed to do more to get increased bailout money, the US president said: "Yes. They're not quite there yet."


Obama is due to unveil on Monday a much-anticipated plan on the future of ailing US automakers who have asked for billions of dollars in further government aid to weather the economic crisis.
"There's been some serious efforts to deal with a combination of long-standing problems in the auto industry and the current crisis, which has seen, you know, the market for new cars drop from 14 million to nine million," Obama told CBS on Face The Nation.


"We think we can have a successful US auto industry. But it's got to be one that's realistically designed to weather this storm and to emerge -- at the other end -- much more lean, mean and competitive than it currently is.


"They're not there yet."

 

[uncleyap]

The Capital of Capitalism = USA has it's Auto Industries under mere Communism Styled State Fundings and Governmental Management. Soon it will be the Finance Industries and others. Automotive being one of the American Pride & Pioneer Industries of the Industrialized Empire State, whiles cars are mere American people's life style feature, after horses from their grand parents' cowboy days. Today's cars in USA replaced the horses rode by both cowboys and Indians.

Today White House funds and bailed out and act as super-management or super-director-board for the Capitalists' Automotive Industries. Demonstrating a classic feature of Communist Economies. This fact signifies that FREE MARKET ECONOMIC PRINCIPALS which is the spirit; tenet; motto and faith adopted by the Capitalism World is diminishing and drifting towards Communism.:p

In a Free Market Economy, it is without any interference from their government, how the economies & commerce / corporations are born; grown; develop; expand; contract; merge; split; close; perish; or struggle for survival.

In the USA, Presidents from Abram Lincoln till Bill Clinton - from the White House only regulate tax; interest rate; import/export duties and nothing much else to the private and Free Market Economy, they insisted on Free Trade. None of the US president had done what Obama is doing.

In the past Americans criticized how Communist Governments had injected state funds into failing and rotting state-own business and arbitrarily forged Communist Economies AGAINST FREE MARKET PRINCIPALS. American leaders also criticized Protectionism & State Equity & Governmental Officials in boards of directors of businesses - Temasek GIC typically.

Bush Jr, had started with the bailing outs, but Obama continued and expanded the scale of it, and made it a trend. He created strong dependencies from the sick & dying American industrial and commercial giants to the tax payers' already heavy burdens + the deficit and enormous debts owed by USA.

Obama's White House is now literally like famiLEE LEEgime's Sri Temasek, which is the super-management or super-directorship of major US businesses starting from Automobile Industries.

http://news.yahoo.com/s/ap/20090331/ap_on_go_pr_wh/auto_bailout

Obama expands government's role in auto industry

WASHINGTON – President Barack Obama's extraordinary auto industry intervention is assertive and coldly pragmatic, with a dose of caution and a sentimental nod to the automobile's place in the American psyche.

Obama's curt rejection of General Motors' and Chrysler's restructuring plans and his abrupt move to muscle out GM's CEO set the stage for a major realignment of the U.S. auto industry. He bluntly raised the prospect of a "prepackaged bankruptcy" that would reorganize the companies quickly under court protection.

But Obama did not upend Detroit in one single swoop. He gave each company a second chance at a federal bailout — 60 days for GM and 30 for Chrysler — though it was evident that from now on little would remain the same.

"We've reached the end of that road," Obama declared Monday.
The administration's analysis of the viability of the two auto giants was merciless and remarkably specific in its critique of their business practices. It said GM's underperforming dealers were a drag on the company and its car of the future, the plug-in Chevrolet Volt, held promise but was too expensive. As for Chrysler, the president said it could only survive with an international partner, the Italian carmaker Fiat SpA.

All in all, the administration and its auto task force concluded that the automakers' plans to change their mix of products, fix their balance sheets, reduce production capacity and launch new vehicles were simply too slow.

"There seems to be a major difference of opinion between the auto task force and GM not about what's desirable, but what's realistic over some undefined business cycle," Malcolm Salter, a professor emeritus at Harvard Business School who has advised Ford and GM, said in an e-mail.

Yet Obama also conceded the intangible nature of the auto industry as a national symbol, and made it clear he would not let it succumb under his watch. He called the industry an emblem of the American spirit and a pillar of the economy.

"We cannot, and must not, and we will not let our auto industry simply vanish," he said.
The forced ouster of GM CEO Richard Wagoner, the detailed review of the companies' business models and the overt threat of bankruptcy represented an increasingly hands-on approach by the government to institutions receiving federal assistance in the midst of the economic crisis.

But the White House on Monday downplayed the difference between Obama's treatment of the automakers and the less stringent conditions it has placed on the financial industry in return for financial infusions worth billions of dollars.

White House spokesman Robert Gibbs said each institution has distinct effects on the economy and, as a result, the government's response to each would be specific to their circumstances.

The president was hardly ambiguous about his desire to use the beleaguered state of the industry to press one of his top policy agendas — an energy policy that emphasizes the manufacture of fuel-efficient, environmentally friendly cars.

"The United States will lead the world in building the next generation of clean cars," he said.
Obama's restructuring conditions include concessions from bondholders, the investors who hold GM and Chrysler debt, as well as from the United Auto Workers, which represents the industry work force. "It will require unions and workers who have already made extraordinarily painful concessions to do more," Obama said.

A committee of GM bondholders issued a statement Monday saying bondholders were willing to exchange "a substantial part" of their debt for stock in the company. But the statement said the committee was "very disappointed that the government and company have had virtually no real dialogue with bondholders while designing the proposed restructuring plan."

Though administration officials insisted Monday that bankruptcy was not a preferred option, the president went out of his way to explain what a court-overseen restructuring would entail. He stressed that bankruptcy would help Chrysler and GM clear old debts and place them on a sustainable path. "What I'm not talking about is a process where a company is simply broken up, sold off and no longer exists," he said.

The idea of using a speeded-up bankruptcy process for the auto industry circulated in Congress last November. But both executives and labor leaders objected to the idea even with the backing of federal guarantees, saying it would taint the companies with consumers and risk retiree health benefits.

A Chapter 11 bankruptcy allows a company to stay alive and retain control of its assets while paying off creditors and reorganizing. In the process, they raise capital, downsize and renegotiate contracts. The companies would still need billions in government assistance, however, because the companies would not find easy access to financing in the currently frozen credit markets.

To encourage consumers to buy new cars, Obama announced that the government will now back new car warranties issued by GM and Chrysler, assuring car owners that their purchases will be protected. The administration also was pursuing other measures that were not tied directly to GM or Chrysler, and would also help their competitors.

The Internal Revenue Service announced a new plan to allow taxpayers to deduct the sales tax and excise tax on any new car they purchase, whether foreign or domestic. Obama said he also was working with Congress on "cash for clunker" legislation that would reimburse car owners who turn in an older car for a new, more fuel-efficient vehicle.

A senior Obama administration official said GM and Chrysler would put together the revised plans with help and advice from the Treasury Department and the auto task force. The official was not authorized to speak publicly about the discussions.

"They're taking significant responsibility now here for the future of the industry and there's upside and downside to that," Sen. Carl Levin, a Michigan Democrat who has been active in helping the industry survive, said of the administration's role. "Hopefully there's enough people who know enough about the industry who understand the risks of one course or another."
___
Associated Press writer Ken Thomas contributed to this report.

 

[Porfirio Rubirosa]

I suggest you do not get carried away with your apparent simplified analysis. Have you heard about the LTCM collapse and the bailout supervised by the Fed thereafter in the late 1990s? What about the S&L crisis in the 80s and 90s also with US taxpayers bailout money?

If you believe the Americans are moving away from capitalism towards communism then I think you really need to get a reality check. Once the dust settles on this crisis, which it shall eventually, the Americans shall invariably return to the same old ways of capitalism which is as American as apple pie and baseball.

 

[uncleyap]

I suggest you do not get carried away with your apparent simplified analysis. Have you heard about the LTCM collapse and the bailout supervised by the Fed thereafter in the late 1990s? What about the S&L crisis in the 80s and 90s also with US taxpayers bailout money?

If you believe the Americans are moving away from capitalism towards communism then I think you really need to get a reality check. Once the dust settles on this crisis, which it shall eventually, the Americans shall invariably return to the same old ways of capitalism which is as American as apple pie and baseball.

So do you think the Russians will revert back to Soviet & Chinese will revert back to Maoism and that their capitalism today is only temporary?



I think certain things in this world are irreversible such as age and death. Not to forget virginity. :-)

Matters like these Capitalism / Communism things... you think can stitch hymen back? :-)

 

[Porfirio Rubirosa]

I recall you once mentioned that you worked in the States for awhile, in Cali if I am not mistaken? That is why I am surprised by your apparent simplified analysis in this thread.

Capitalism is part of Americans DNA, it is in their blood, culture, heritage and custom and this crosses the whole of US not just in several states. It is highly unlikely and improbable that anything can change this basic American trait. No doubt this present economic crisis is very serious and shall probably have serious ramifications as well. But to take the quantum leap towards communism, cobblers and nonsense.

Look the Depression in 1929 was far worse than what is now happenning in the States and that was the time when Communist ideology was really starting to appeal in several quarters across the globe, so if the Americans were not prepared to wind down capitalism then and shift towards communism why should they consider doing so now? It ain't going happen, take a trip to the States now and talk to normal American folk and see if they are in favour of moving towards Communism. I am sure they shall be tickled pink, pardon the pun.

Change in the regulatory regime shall probably come about, that and change in practices, ethics and maybe even more of a socialist appeal perhaps. However capitalism shall remain.

As for Russia and China, I am not sure, as I do not have such a good pulse and understanding of both countries systems. But I would think with globalisation, modern technology and cheap travel, and their respective younger generations getting a feel of capitalism i.e. making money and spending money, I don't think their populations would want to turn back the clock to communism of the past.

I guess it is all about trying to find some sort of balance between individual ability (the good aspects like innovation and creativity and entrepreneurship) and the collective interest of society (peace and stability). There is probably no perfect balance, so it shall be more of a push and pull between the forces of society.

So do you think the Russians will revert back to Soviet & Chinese will revert back to Maoism and that their capitalism today is only temporary?



I think certain things in this world are irreversible such as age and death. Not to forget virginity. :-)

Matters like these Capitalism / Communism things... you think can stitch hymen back? :-)

 

[uncleyap]

I recall you once mentioned that you worked in the States for awhile, in Cali if I am not mistaken? That is why I am surprised by your apparent simplified analysis in this thread.

Capitalism is part of Americans DNA, it is in their blood, culture, heritage and custom and this crosses the whole of US not just in several states. It is highly unlikely and improbable that anything can change this basic American trait. No doubt this present economic crisis is very serious and shall probably have serious ramifications as well. But to take the quantum leap towards communism, cobblers and nonsense.

Look the Depression in 1929 was far worse than what is now happenning in the States and that was the time when Communist ideology was really starting to appeal in several quarters across the globe, so if the Americans were not prepared to wind down capitalism then and shift towards communism why should they consider doing so now? It ain't going happen, take a trip to the States now and talk to normal American folk and see if they are in favour of moving towards Communism. I am sure they shall be tickled pink, pardon the pun.

Change in the regulatory regime shall probably come about, that and change in practices, ethics and maybe even more of a socialist appeal perhaps. However capitalism shall remain.

As for Russia and China, I am not sure, as I do not have such a good pulse and understanding of both countries systems. But I would think with globalisation, modern technology and cheap travel, and their respective younger generations getting a feel of capitalism i.e. making money and spending money, I don't think their populations would want to turn back the clock to communism of the past.

I guess it is all about trying to find some sort of balance between individual ability (the good aspects like innovation and creativity and entrepreneurship) and the collective interest of society (peace and stability). There is probably no perfect balance, so it shall be more of a push and pull between the forces of society.

Your reasoning is INVALID, I am sorry to say.

Your so called DNA in the American blood can at the most contribute to a DESIRE factor for Capitalism. This argument does NOT AT ALL point out that Americans will HAVE CAPITAL.

To illustrate, I can tell you that even stronger DNA are in the blood of Chinese towards Capitalism. In Most Parts of Chinese History it had been Commercial & Capitalist World = NON-Communist. In the view of most Singaporeans PRC Chinese are $$$$$ Beasts, so to compare with your Capitalist DNA talks.

Civil War and a series of foreign invasions toward the end of Qing Dynasty caused the nation to be very broke, very dry, very poor = Lack of Capital, just before they turned away from Capitalism and began Communism.

In Soviet history, POOR MASSIVE PEASANT POPULATION revolt against Royal Czar family was the basis of change to Communism. Massive poverty is the primary basis of most countries' Change From Capitalism to Communism e.g. North Korea; Indo-China; Cuba; Eastern Europe etc.

The same reason for ALL of them roughly, is THE LACK of Capital among populace led to Communism.

USA is sharing the same reason. UK and even Japan is Approaching the same state. And in worst state than the other nations' pre-communism poverty, the Americans British & Japanese families owes DEBT on top of just being poor, comparing to the state of poor peasants' families at their pre-communism scenario, these pre-communist peasants were just being poor in the sense that they have little property & no capital, BUT THEY DON'T OWE HUGE DEBTs e.g. credit cards; house loans; car loans; medical bills; education loans..... etc.

Americans & other G8 countries people are indeed in worst financial situations than the pre-communism peasants of these communist domino countries. These countries don't even owe foreign debts half as bad as USA, in their pre-communism states.

The desires of people, can not ideally change their own fate. Desires of wealth and freedom inclusive. When your go broke, sorry to your dreams! When you are in vulnarable state to be exploited by totalitarian regimes, sorry to your desire for freedom.

You may claim that you have DNA in your blood same as Bill Gate's but sorry, money don't fall from sky to enrich you! When populace in a country / society are boke, there is no Capital but Debts, they can only dream Capitalism. Communism is before them as a natural and immediately availiable solution for survival and strengthening.

The previous Depression Era (1930s) also preceded the period of Communism Domino (wide-spreading). It is very likely that it will be the same this round for this reason. People turned to Communism in search for solution for survival amid massive financial crisis that was.

The rest following here are beside the point, but I am saying for the sake of correction to things you said about USA.

Yes you are right, USA is my 3rd home. Or was my 3rd home before.

I worked in California Silicon Valley where Gopalan Nair now lives, and I also worked in Florida, near to Miami Beach. California & Florida are the 2 states in USA that has most important electoral votes in presidential elections. Moron Bush's election was decided by court in Florida.

Most Americans are lazy and not so smart. Enjoying good life and spent future money, but contributing little to their country and society. Their ancestor's hardworking and brave contributing characters are gone from the present generation. No black slaves, no cowboys, no tribal Indians any more, lots of Asians & Mexicans + Latin + illegal immigrants too.

California's Silicon Valley's lot & NY lot are exceptional minority in the front end and cutting edge of world economy, they are not to be taken as example of typical US citizens. They are less than 1% of the US people. My customers in USA included the Hollywood & Broadway movie movie industries, who are the rich lot, and not representing the American populace.

Yes American people have desire for freedom and wealth and security and GOOD LIFE. But these are Not At All equal to HAVING these things, like wealth & capital. I can tell you that the America that I know has too few people that can Contribute towards solving their own HUGE problems, most of them can only make the problems worst, and it had been that way since at least 1 previous generation. The contributing sprits of American Pioneers & Cowboys & Red Indians & Black Slaves are GONE long ago.

I know very well from my years in the USA that, when USA goes broke, they will stay deeply broke for a very long time.

 

[uncleyap]

http://news.yahoo.com/s/ap/20090331/ap_on_bi_ge/g20_summit

Desperate world leaders meet on economic woes



LONDON – Desperate but divided on ways to lift their nations from economic misery, world leaders converged for an emergency summit Tuesday holding scant hopes of finding a magic-bullet solution for the crisis that brought them hurrying to London. Even as President Barack Obama and the others were arriving, the U.S. acknowledged its allies would not go along with a massive burst of stimulus spending, while Europe was forced to backpedal from hopes for tighter financial regulation.

Instead, leaders are trumpeting the limited common ground they could reach, including more money for the International Monetary Fund and closer scrutiny of hedge funds and tax havens. As for the broader issues, they're hoping for the best — or at least that they will do no harm.

With turbulent world markets watching closely, the stakes are high, especially for America's new president, stepping onto the world stage for the first time to deal with the economic crisis and to meet face-to-face with many other leaders.

One global change is being acknowledged: The forum for grappling with world economic problems has grown beyond the established eight post-war economies that dominated previous economic summits — the U.S., Britain, Germany France, Japan, Canada, Italy and Russia. Now, 20 nations are coming together in London, with fast-growing developing economies such as China, India, Brazil and Saudi Arabia — important players in any effort to coordinate economic policy — sitting as full negotiating partners.

"For the first time, there's a recognition that major emerging markets and developing countries have a critical role at the table," said Mike Froman, a White House international economic adviser.
But will that mean action to stop a global downward spiral?
Froman acknowledged that there have been few examples of international gains in times of crisis. "The depression was made 'great' by the lack of cooperation," he said, noting that nations like to keep control over their own fiscal and monetary policies.
And global leaders were quarreling up to the last minute before the summit.

Adding to the pressure, French President Nicolas Sarkozy said Tuesday the leaders cannot afford to let the week pass without making substantial progress in fixing the world's economy.

"We have to obtain results, there is no choice, the crisis is too serious to allow us to have a summit for nothing," he said.

European countries are pushing for a tougher regulatory system for global finance, while the U.S. is emphasizing more spending — an idea that holds little interest for Europeans wary about debt.
Obama planned a round of meetings with leaders on Wednesday, including Queen Elizabeth II, summit host British Prime Minister Gordon Brown and the presidents of Russia and China.

The world economy is in far worse shape than when the group of rich and developing countries last met in November and set lofty goals for international cooperation.

Trade is deteriorating, protectionism is on the march and joblessness is rising. Street demonstrations have increased, and widespread protests are expected in London this week.

Brown, the host, had initially trumpeted the gathering as "a new Bretton Woods — a new financial architecture for the years ahead." But the meeting was shaping up as bearing little similarity to the 1944 conference in New Hampshire where the winners of World War II gathered to set postwar global monetary and financial order.
Brown's spokesman said the prime minister had spoken briefly by telephone on Tuesday with Obama, who was on Air Force One.
"It's an opportunity for both of them to take stock of where we were," Brown's spokesman Michael Ellam said.

World Bank President Robert Zoellick called for the G20 to back a $50 billion liquidity fund to keep global trade moving. In rich countries, he said, "people talk of bonuses or no bonuses. In parts of Africa, South Asia and Latin America, the struggle is for food or no food."
London does not have a good history for successful economic summits. One held in London in 1933, attended by more than 1,000 world leaders and financial officials — although not President Franklin D. Roosevelt — met for six weeks and then gave up.

Still, most leaders were upbeat Tuesday as they headed to London.
"It is important and necessary for the summit to take credible decisions which will help to halt and reverse the current slowdown and to instill a sense of confidence in the global economy," said Indian Prime Minister Manmohan Singh.

Summit partners will meet for dinner on Wednesday evening, then hold a business meeting on Thursday.

A draft of the communique circulating ahead of the meeting suggested that global leaders will embrace stimulus spending totaling about $2 trillion. But that includes a number of measures already announced.
Leaders of European countries, led by Germany's Angela Merkel, continued to resist calls for more stimulus and for printing money as the U.S. Federal Reserve and the Bank of England have done to try to jump-start a recovery.

Memories of the hyperinflation in the 1920s in Germany that gave way to the rise of Adolf Hitler's Nazi party still haunt modern-day Germany.
On Wednesday, Obama will have separate meetings with Brown, Russian President Dmitry Medvedev, and with Chinese President Hu Jintao.

With Moscow, the agenda will include disputes over energy, Russia's continued opposition to U.S. missile defense sites in Eastern Europe and warhead cutbacks. Obama has indicated less enthusiasm for the missile system than predecessor George W. Bush, raising hopeful expectations in Moscow. But Russian leaders have engaged in tough talk lately in terms regaining their own status in the world, posing an early test for Obama.

Obama's meeting with Hu is likely to touch on recent Chinese concern about the safety of its vast holdings in U.S. Treasury bonds, given dollar-eroding U.S. stimulus programs. China surpassed Japan last year as the largest holder of U.S. debt, and any Chinese flight away from those investments would rock global markets.

On the way to Europe, Obama aides made clear expectations have been lowered.

Instead of focusing on the additional stimulus spending the U.S. had sought, White House press secretary Robert Gibbs emphasized what already has been accomplished. G20 nations have spent so far an amount equal to 1.8 percent of their collective gross domestic product, he said, calling that "a significant commitment."

Gibbs also said he expects a joint pledge that the leaders will act further if developments warrant, and he said that commitment satisfies Obama. He also touted new regulatory proposals and the intention to boost contributions to the IMF.

 

[Porfirio Rubirosa]

Yap,

The only relevant bit I need to address is what you said below

The previous Depression Era (1930s) also preceded the period of Communism Domino (wide-spreading). It is very likely that it will be the same this round for this reason. People turned to Communism in search for solution for survival amid massive financial crisis that was.

Yeah so what happened in the States during THE DEPRESSION, which by the way was much worse than the present serious Recession? Why did the Americans not turn to Communism then when millions of Americans became poor and destitute, more so since Communism was on the rise as opposed to today?

Anyway, Communism is not the answer in today's global community, in fact it was never the answer to begin with because of its inherent flaws.

Oh and as for your take on the States and Americans, I think it is abit narrow minded and one dimensional, bearing in mind how big the country is and the size of its population, diversity and dynamism. To me the day the States stops attracting the best talent in the world on a relative basis, shall be the day it goes into inevitable decline.

 

[uncleyap]

Yap,

The only relevant bit I need to address is what you said below

The previous Depression Era (1930s) also preceded the period of Communism Domino (wide-spreading). It is very likely that it will be the same this round for this reason. People turned to Communism in search for solution for survival amid massive financial crisis that was.

Yeah so what happened in the States during THE DEPRESSION, which by the way was much worse than the present serious Recession? Why did the Americans not turn to Communism then when millions of Americans became poor and destitute, more so since Communism was on the rise as opposed to today?

Anyway, Communism is not the answer in today's global community, in fact it was never the answer to begin with because of its inherent flaws.

Oh and as for your take on the States and Americans, I think it is abit narrow minded and one dimensional, bearing in mind how big the country is and the size of its population, diversity and dynamism. To me the day the States stops attracting the best talent in the world on a relative basis, shall be the day it goes into inevitable decline.

This thread is not intended for other thing than pointing out my Cross Road observation. Nothing about Advantages & Disadvantages of Communism / Capitalism is intended here, which is itself a very lengthy and big subject.

What I pointed out is that fact that Communism was the route sorted by these so called Communism Domino states at the time of hardship, deprivation and serious lack of resources / capital. In examples of Communism Giants Soviet & PRC, it proved that Communism had strengthen their countries rapidly without much resources from very war torn or devastated states to significant world power within very short time.

Whereas many Capitalism countries just eroded in stages as their people indulged & enjoy too much without giving their share of positive contributions to their own countries.

It is NOT my argument at all that when things goes bad then Communism is the ONLY nor BEST solution. This is not the case, this is not my argument either. However, it had been true in examples that I had quoted.



For superpower USA to go from one extreme to another it is not something of Rapid and Short-Term nature. It is very unlike SGP.

I had for the longest time observed USA with attention. And at close range too - living & working there. I know for sure that they suffer a very big deficit, not just in terms of finance. There is deficit in many other non-monetary aspects, e.g. the individual citizen's contribution vs what they enjoy - if one take much more than give - it contributed to an amount of deficit, be it in the field of national security; social responsibility; Freedom / Rights; Intellectual; Moral; Creativity; Consumption / Preservation of natural resources (in terms of El Gore's definition of green); Good will; International friendship & relation; Karma if you believe..... etc etc.

Deficits in so many aspects piled up in the past few generations in USA. Like Snow-Ball indeed. I was anticipating and counting down to see the consequences of these deficit, and it seems that the answer arrived coincidentally with Bush & Obama.

That's all I can say.

 

[Porfirio Rubirosa]

Well Yap, your so called "Cross Road Observation" is wrong from the outset as there is no "cross roads" going on in the first place. Changes are happening and shall and will have to happen as this serious financial economic crisis is played out. But this does mean that capitalist societies are at a "cross roads" turning towards communism of all ideologies.

As for the States, well I stand by what I said in my earlier post. The day the States finally fails and stops to attract the best and brightest talents around the globe, shall probably be the day the States goes into inevitable decline. Oh and remember this, the States bounced back from The Depression, the 70s Oil crisis, stagflation, the Japanese economic attack in the 80s etc. So I would not write off the Americans so easily. Yes over: consumption, consumerism and materialism have to be addressed and are real serious challenges, but shall they be the death knell of the States? I don't think so.

 

[Porfirio Rubirosa]

Oh Yap just to lighten the mood...

The Difference between Communism & Capitalism:


In communism we nationalise the banks and then push them to

bankruptcy. In capitalism we push the banks to bankruptcy and then

nationalise them.

 

[uncleyap]

Oh Yap just to lighten the mood...

The Difference between Communism & Capitalism:


In communism we nationalise the banks and then push them to

bankruptcy. In capitalism we push the banks to bankruptcy and then

nationalise them.

Today we are seeing all the Capitalist banks going Lao Sai, Communists' banks are Strong and Healthy. Why?



This thread is only about ECONOMY. Not about Political System e.g. Election / Polling / Appointment of Govt.

Certainly Obama had been elected by poll, unlike Bush was decided by court.

Corrupted Ah Bian also elected by poll initially, and then later re-elected with the help of bullet (vs Ballot).

The Cross Road In Global Economy had been exhibited factually by current affairs.

These CHANGE / Perestroika are not temporary short term nature. Certain changes can not be un-done after they are done. To complete a cycle and be rotated back to same phase, may take generations and multiple life time.

 

[Porfirio Rubirosa]

Perhaps, but I would not be too sure that even the 'Commie Banks' are that healthy, could be lots of stinky NPLs on their books covered up by their central banks for now.

Anyways one way or another, the Capitalist socieites will have to deal with these toxic bank loans and take it out of the system before things finally return to normal, they all know this, the question is how to do it with the least 'pain' (if that is at all possible). And make no mistake it shall be taken out sooner or later, the other question is when.

But that does not mean the Capitalist Societies are or shall take the Commie route to solve this problem. Temporary nationalisation of certain sectors of the economy does not amount to being Commie, not by a long shot. In any event, just going by today's press I have read that there are already some US banks who are returning back the $$$ injected by the State because they do not want to be under onerous State conditions.

Oh and just because you claim << The Cross Road In Global Economy had been exhibited factually by current affairs.>> does not make this a fact, far far from it.

Today we are seeing all the Capitalist banks going Lao Sai, Communists' banks are Strong and Healthy. Why?

 

[uncleyap]

Perhaps, but I would not be too sure that even the 'Commie Banks' are that healthy, could be lots of stinky NPLs on their books covered up by their central banks for now.

Anyways one way or another, the Capitalist socieites will have to deal with these toxic bank loans and take it out of the system before things finally return to normal, they all know this, the question is how to do it with the least 'pain' (if that is at all possible). And make no mistake it shall be taken out sooner or later, the other question is when.

But that does not mean the Capitalist Societies are or shall take the Commie route to solve this problem. Temporary nationalisation of certain sectors of the economy does not amount to being Commie, not by a long shot. In any event, just going by today's press I have read that there are already some US banks who are returning back the $$$ injected by the State because they do not want to be under onerous State conditions.

Oh and just because you claim << The Cross Road In Global Economy had been exhibited factually by current affairs.>> does not make this a fact, far far from it.

I think it does not matter weather a bank management's integrity is tied to the economy model i.e. weather Communist or Capitalist.

Weather they are Book Cooking Crooks or Honest Banks it is not tied to the economic model they belong to. Any Communist / Capitalist Banks can be Honest or Crooked.

Further weather they have the experience or skill or knowledge as Bankers, is also nothing to do with their economic model.

Too prejudice to say that Communists must be bad bankers. Look at USA's banks are they really good when things are at this stage?

Today's communist economies are stronger and more wealthy with capital, they have more chance to gain experience & develop toward stronger position as banks.

IMF is also forced to listen to Communist Governments and can not ignore their position and strength.

 

[Porfirio Rubirosa]

Prejudice and ability is not the issue here. It is your "crossroads" claim that is the issue, movement from Capitalism to Communism, which is bunkum.

Capitalist economic model moving from say the deregulated Anglo-American model to the more regulated Franco-German-Scandanavian model I agree, and from what I have read transpired in London over the past few days at G20 I think this is in fact what may happen. But certainly no move towards a Communist economic model.

China and to a lesser extent the other BRICs are now a force to be taken seriously because of their economic power but it does not necessarily follow that the old developed capitalist societies shall follow and adopt these societies economic models, far far from it. No factual evidence at the moment.

Too prejudice to say that Communists must be bad bankers. Look at USA's banks are they really good when things are at this stage?

Today's communist economies are stronger and more wealthy with capital, they have more chance to gain experience & develop toward stronger position as banks.

IMF is also forced to listen to Communist Governments and can not ignore their position and strength.

 

[uncleyap]

Prejudice and ability is not the issue here. It is your "crossroads" claim that is the issue, movement from Capitalism to Communism, which is bunkum.

Capitalist economic model moving from say the deregulated Anglo-American model to the more regulated Franco-German-Scandanavian model I agree, and from what I have read transpired in London over the past few days at G20 I think this is in fact what may happen. But certainly no move towards a Communist economic model.

China and to a lesser extent the other BRICs are now a force to be taken seriously because of their economic power but it does not necessarily follow that the old developed capitalist societies shall follow and adopt these societies economic models, far far from it. No factual evidence at the moment.

Before this founder named Marx, the entire world was Capitalist.

Every Communist state had turned from Capitalism to Communism.

Obama's Government is certainly not a Communist Revolution, but it policies are full of Communist Economic Feature, which are effective in regaining national strength with resources and capitals etc had been exhausted.



Later the situation will force Obama & other non-US govts which shares identical problems too to adopt something in that line.

By then the crossroad intersection will be fully formed.

For now, the world is just only approaching that. I anticipate to see more of such development in near future.:p

 

[Porfirio Rubirosa]

China’s Dollar Trap
By PAUL KRUGMAN
Published: April 2, 2009

Back in the early stages of the financial crisis, wags joked that our trade with China had turned out to be fair and balanced after all: They sold us poison toys and tainted seafood; we sold them fraudulent securities.

But these days, both sides of that deal are breaking down. On one side, the world’s appetite for Chinese goods has fallen off sharply. China’s exports have plunged in recent months and are now down 26 percent from a year ago. On the other side, the Chinese are evidently getting anxious about those securities.

But China still seems to have unrealistic expectations. And that’s a problem for all of us.

The big news last week was a speech by Zhou Xiaochuan, the governor of China’s central bank, calling for a new “super-sovereign reserve currency.”

The paranoid wing of the Republican Party promptly warned of a dastardly plot to make America give up the dollar. But Mr. Zhou’s speech was actually an admission of weakness. In effect, he was saying that China had driven itself into a dollar trap, and that it can neither get itself out nor change the policies that put it in that trap in the first place.

Some background: In the early years of this decade, China began running large trade surpluses and also began attracting substantial inflows of foreign capital. If China had had a floating exchange rate — like, say, Canada — this would have led to a rise in the value of its currency, which, in turn, would have slowed the growth of China’s exports.

But China chose instead to keep the value of the yuan in terms of the dollar more or less fixed. To do this, it had to buy up dollars as they came flooding in. As the years went by, those trade surpluses just kept growing — and so did China’s hoard of foreign assets.

Now the joke about fraudulent securities was actually unfair. Aside from a late, ill-considered plunge into equities (at the very top of the market), the Chinese mainly accumulated very safe assets, with U.S. Treasury bills — T-bills, for short — making up a large part of the total. But while T-bills are as safe from default as anything on the planet, they yield a very low rate of return.

Was there a deep strategy behind this vast accumulation of low-yielding assets? Probably not. China acquired its $2 trillion stash — turning the People’s Republic into the T-bills Republic — the same way Britain acquired its empire: in a fit of absence of mind.

And just the other day, it seems, China’s leaders woke up and realized that they had a problem.

The low yield doesn’t seem to bother them much, even now. But they are, apparently, worried about the fact that around 70 percent of those assets are dollar-denominated, so any future fall in the dollar would mean a big capital loss for China. Hence Mr. Zhou’s proposal to move to a new reserve currency along the lines of the S.D.R.’s, or special drawing rights, in which the International Monetary Fund keeps its accounts.

But there’s both less and more here than meets the eye. S.D.R.’s aren’t real money. They’re accounting units whose value is set by a basket of dollars, euros, Japanese yen and British pounds. And there’s nothing to keep China from diversifying its reserves away from the dollar, indeed from holding a reserve basket matching the composition of the S.D.R.’s — nothing, that is, except for the fact that China now owns so many dollars that it can’t sell them off without driving the dollar down and triggering the very capital loss its leaders fear.

So what Mr. Zhou’s proposal actually amounts to is a plea that someone rescue China from the consequences of its own investment mistakes. That’s not going to happen.

And the call for some magical solution to the problem of China’s excess of dollars suggests something else: that China’s leaders haven’t come to grips with the fact that the rules of the game have changed in a fundamental way.

Two years ago, we lived in a world in which China could save much more than it invested and dispose of the excess savings in America. That world is gone.

Yet the day after his new-reserve-currency speech, Mr. Zhou gave another speech in which he seemed to assert that China’s extremely high savings rate is immutable, a result of Confucianism, which values “anti-extravagance.” Meanwhile, “it is not the right time” for the United States to save more. In other words, let’s go on as we were.

That’s also not going to happen.

The bottom line is that China hasn’t yet faced up to the wrenching changes that will be needed to deal with this global crisis. The same could, of course, be said of the Japanese, the Europeans — and us.

And that failure to face up to new realities is the main reason that, despite some glimmers of good news — the G-20 summit accomplished more than I thought it would — this crisis probably still has years to run.

 

[Alu862]

Yap should join the ranks of Rush Limabuagh and other idiotic people in the US.

Capitalism has failed time and time again. The fall of the Bretton Woods System (if Yap even knows what that is), the 1980s economic crash, the neo-liberal failure in developing countries in the 80s and 90s, Mexico and the IMF in the 90s, the Asian Financial Crisis and now the current crisis--caused by excessive UNFETTERED (DO YOU KNOW WHAT THAT MEANT YAP) free market system...

Oh yes, communism and social tendencies are not good. Which country now hold tons of US financial assets? Why are European nations able to buffer the recession much better than Yap's idol America?

PLEASE. JOIN YOUR FRIEND GOPALAN in California.USA--THE LAND OF IDIOTS wher Yap belongs.

 

[Watchman]

So much words and I am lost !