May 2, 2004
A PRAYER FOR THE DYING:
Let Us Pray (THOMAS L. FRIEDMAN, 5/02/04, NY Times)
Here's what I learned in Tokyo: If you're the leader of Japan, America, Australia, Taiwan, Malaysia, Russia, Thailand, Indonesia, Singapore, the Philippines or the European Union and you're not going to bed each night saying the following prayer for China, then you're not paying attention:"Dear Heavenly Father, please keep the leader of China, President Hu Jintao, healthy and on an even keel. Please see to it that he moves steadily and carefully toward restructuring the Chinese banking system and ridding it of its huge overhang of bad loans and corruption, before there is a real meltdown that would be felt around the world. Give him the wisdom to cool the overheated Chinese economy without creating a recession that would prompt China to stop importing like crazy and start just exporting like crazy. And Father, forgive us for all the bad words we used in recent years to describe China's leaders — terms like `Butchers of Beijing.' We did not mean it. We meant to say `Bankers of Beijing,' because their economy is now fueling growth all over Asia, bolstering Japan and sucking up imports from everywhere. May China's leaders live to 120, and may they enjoy 9 percent G.D.P. growth every year of their lives. Thank you, Father. Amen."
Anyone betting all their chips on the stability of China is a fool. Posted by Orrin Judd at May 2, 2004 9:02 AM
Well, OJ, since we are relying on them to fund our deficits, we must be fools.
Posted by: Robert Duquette at May 2, 2004 10:37 AMThere's always someone to buy the debt, my little valetudinarian...
Posted by: oj at May 2, 2004 10:45 AMYes, Grasshopper, for a price everything can be sold.
Posted by: Robert Duquette at May 2, 2004 11:40 AMThere are entire industries doing just that.
Posted by: Jeff at May 2, 2004 12:46 PMWal-Mart, anyone?
Posted by: Harry Eagar at May 2, 2004 6:04 PMRobert, are you nuts? When/if China disentigrates, just who will we pay off our loans to? Which of the many new groups would have the clear authority to claim the notes?
Posted by: ray at May 2, 2004 7:48 PMFor what it's worth, the latest Conspiracy Theory going around the Art Bell Show (besides The Day After Tomorrow) goes like this:
China keeps the yuan artificially low against the dollar so we keep outsourcing all our manufacturing to them and completely deindustrialize ourselves. Then China floats the yuan, all prices for Chinese goods (which our "post-industrial, information-age, service-based economies" are completely dependent on) double overnight, and the world sinks into the Second Great Depression. Except for China, whose "obsolete" manufacturing plants produce the necessities for the rest of the world. And the Foreign Devils come on their knees to the Celestial Kingdom with tribute on the backs of their hands, resuming their proper place in All-under-Heaven.
Posted by: Ken at May 4, 2004 12:46 PMRay, it's not a very good financial plan that counts on the disintegration of creditors in order to eliminate debts. You've been drinking OJ's Koolaid a little too much. China is not going to disintegrate. Even if they did, they would have sold their assets at some time prior to crashing. Someone always inherits the markers.
Posted by: Robert Duquette at May 4, 2004 5:37 PMSo I see you've graduated from the Koolaid, and you're hitting the real hard stuff now. One word of advice OJ: you can't fly. Step away from the window.
Posted by: Robert Duquette at May 4, 2004 6:26 PMRobert:
There's an amusing assumption that underlies nearly all worrying over China--that we might go to military war with them at some point but that using our obvious economic weapons is unthinkable. It's a juvenile conceit.
Posted by: oj at May 4, 2004 6:37 PM