HSBC bids farewell to dollar supremacy

[aegis]

Quote from poyayan:

2) It still has this little war in afghan and I don't see people cheering for it.

Doesn't matter.

All you have to do is stage a little event that upsets enough American citizens. They'll be more than willing to go to war. How many Americans supported invading Afghanistan eight years ago?

 

[TraderZones]

Quote from wildfirepow:

Japan Abandons America

For over 50 years, one party ruled Japan virtually uninterrupted. During that time, Japan remained a loyal ally and supporter of U.S. policy. This month, a historic event took place.

Japan has new leadership. In a landslide victory, a new party has done the seemingly impossible. A new freshman class of leaders now governs the Land of the Rising Sun. The effects are already rippling across the Pacific toward America.

Yukio Hatoyama is Japan’s new leader. He officially took office last Wednesday, and he is already threatening to split with the United States.

Hatoyama blames America for the global economic crisis and says that the U.S. is responsible for “the destruction of human dignity.” He campaigned on protecting traditional Japanese economic activities and reducing U.S.-led globalization.

During the run-up to the election, Hatoyama’s finance minister told the bbc he was worried about the future value of the dollar, and that if his party were elected in the upcoming national elections, it would refuse to purchase any more U.S. treasuries unless they were denominated in Japanese yen.

Japan is the world’s second-largest economy. It is also America’s second-most-important creditor. The U.S. government owes Japan over $724 billion! The only nation America owes more money to is China ($800 billion). The U.S. also imports $140 billion worth of goods from Japan each year.

If Japan were to follow through with its threat to only lend in yen, the dollar would probably fall hard. What would that mean? America gets more expensive consumer goods, higher unemployment, and currency inflation. If other nations like China follow suit, we would be looking at a currency crisis—Zimbabwe-style.

The new government in Japan has also pledged to diversify its foreign currency reserves away from the dollar. This means that at some point, it will need to dramatically reduce how much money it lends to America. America is planning to borrow record amounts over the next couple of years, so something isn’t adding up here. Where will the money come from?

“The financial crisis has suggested to many that the era of U.S. unilateralism may come to an end,” Hatoyama wrote in an August 26 New York Times article titled “A New Path for Japan.” “It has also raised doubts about the permanence of the dollar as the key global currency.”

But Hatoyama isn’t just charting a separate economic course for Japan. His campaign also promised a more “independent” foreign policy from Washington, and closer relations with Japan’s Asian neighbors.

More alarming for American policymakers, Hatoyama has authorized a wide-ranging review of the U.S. military presence on Japanese soil. He is reexamining the agreement that permits U.S. warships to dock at Japanese ports, and has said Japan should take a second look at why it is spending billions to house and transfer U.S. troops between its islands. Hatoyama has also moved to quickly end Japan’s fueling support for the U.S. naval anti-terrorism efforts in Afghanistan and Pakistan.

On Wednesday, an even bigger torpedo hit. Both U.S. and Japanese officials confirmed that discussions were underway to remove all U.S. fighter aircraft from Japan.

So many alarm bells have been clanging in Washington that the Australian reports the U.S. administration has requested “immediate clarifying discussions” on just how far Japan wants to take the disengagement. But there may not be too much America can do if Japan is intent on reducing America’s presence in Japanese territory. Regarding the U.S.-Japan security relationship, Richard Armitage, former U.S. deputy secretary of state, said: “If the government of Japan asked us to change things, we’d argue, we’d kick and scream, but ultimately we’d have to do it.”

Japan is a major platform for American power projection. Losing it would be devastating to U.S. security.

Japan is America’s most important forward base in the Pacific. It is an unsinkable aircraft carrier from which American task forces can operate to secure the flow of trade and resources across the Pacific.

At a time when China is increasingly challenging American authority in the East and South China Sea, when North Korea is brandishing nuclear weapons, and Islamic terrorism is on the upswing in the Philippines and Southeast Asia, America can ill afford to lose Japanese military and logistical support.

But it is losing it.

In his New York Times article, Prime Minister Hatoyama asked, “How should Japan maintain its political and economic independence and protect its national interest when caught between the United States, which is fighting to retain its position as the world’s dominant power, and China, which is seeking ways to become dominant?” (emphasis mine throughout).

Being allied with America has become a problem for Japan.

The new prime minister is no doubt asking himself: How do I protect Japan’s interests? The distant Americans sit 5,500 miles across the Pacific Ocean. One billion Chinese could fly to Tokyo for breakfast, Taiwan for lunch, and back home for kung pao dinner before America’s fastest jets could make it much past Hawaii.

In the same article, Hatoyama answered his own question: “[W]e must not forget our identity as a nation located in Asia,” he said. “I believe that the East Asian region, which is showing increasing vitality, must be recognized as Japan’s basic sphere of being.”

“I also feel that as a result of the failure of the Iraq war and the financial crisis, the era of U.S.-led globalism is coming to an end ….” Hatoyama even said that Japan must “spare no effort to build the permanent security frameworks” essential to creating a new anti-dollar regional Asian currency shared by China, Japan, South Korea, Taiwan and Hong Kong.

Hatoyama doesn’t just think America’s economy and power are fading fast, he’s publishing it in the New York Times! He sees Japan’s future as being with Asia. And he’s right.

There is a bold movement occurring in Asia. Old animosities are being forgotten, or resolved. “I believe that regional integration and collective security is the path we should follow,” Hatoyama reiterated. Only “by moving toward greater integration” can Asia’s problems be solved, he said.

This movement toward greater Asian cooperation will soon speed up drastically. Not only do the facts prove it, biblical prophecy forecasts it. A major military alliance between Russia, China and Japan is about to be locked in. (Read about this specific prophecy in Russia and China in Prophecy.)

Prime Minister Hatoyama may be the most pro-Asian Japanese prime minister yet. He has pledged to ignore Japan’s World War ii shrine that honors the country’s war dead, to avoid offending Korea. His only son is attending a prestigious Russian engineering university. And he is the first Japanese prime minister to receive election coverage by any Chinese print media—and it was front-page news in the Communist Party’s People’s Daily. Also, for the first time, a Chinese television station provided live coverage of the election that saw Hatoyama take power.

Japan’s new policy is focused on Asia—and winning friends on the Asian continent.

America is about to lose its Japanese ally. “The U.S. has been critical of new trends in Japan, but we are not a colony of Washington and we should be able to say what we want,” said Makoto Watanabe, a professor of media and communication at Hokkaido Bunkyo University in Japan. “[W]hile under previous governments Japan had become a yes-man to the U.S., this suggests to me that healthy change is taking place.”

But that change will not be healthy—especially for America.

The Bible describes a time when America will be besieged by its former trade partners. This siege, warned about in Deuteronomy 28:52, is both economic and military in nature. “And he shall besiege thee in all thy gates, until thy high and fenced walls come down, wherein thou trustedst, throughout all thy land: and he shall besiege thee in all thy gates throughout all thy land, which the Lord thy God hath given thee.”

America is about to be blockaded. For this to occur, Japan would need to take a radical turn from its recent historical political and economic persuasions.

It is radically turning. Today we are witnessing a dramatic fulfillment of this prophecy. America is about to become perilously isolated. The nation with the single largest merchant fleet in the world will turn its back on an economically waterlogged America. And America, without its most important military bases in Asia, will be one step closer to being pushed right out of the Asia Pacific altogether.

America’s ship of state is sinking. Japan’s lifeboat has already left.

http://www.thetrumpet.com/index.php?q=6567.5047.0.0

Frankly, with aircraft carriers, cruise missiles, longrange bombers, predator drones, nucelar submarines the value of landbased fleets is not all that important. So if China attacks Japan and we are not there to help, then Japan is in the toilet.

If China attacks South Korea and they do not want us there, Korea is in the toilet.

Let the Asian countries spend the military $$$ to build their own militaries. They will soon learn.

If Japan and China do not like things, it is time to flatten out the trade deficit with high tariffs on all their goods. There is nothing either country produces that we could not get elsewhere of make ourselves

 

[Lethn]

I love how hostile Americans are to the idea that their currency could collapse and they instantly take it out on any foreigners that criticize them, this is why I'm freaking reminded of the Roman Empire a lot with these guys who were extremely xenophobic. Even the democrats are beginning to realize what a sh*tstorm the economy is coming into, it's only the administrations of either parties left now that seem so blindly in support of this system.

Wake up and realize you aren't the all powerful nation that you think you are, you'll go through a lot less pain and suffering for it.

 

[milktruck]

duh, we are going to Iran. We are starting to build our PR case right now at G20. Europe may even come with us. All of a sudden we are bringing up a nuke plant they didnt disclose that we have known about for years. They have been saving this juicy detail for the right occasion.

I met 2 Iranians last night. Turns out they are Persians and not Arabs. Soon they will be Americans. Its so fucked but we are going in and soon.

 

[Onlygold]

Quote from wildfirepow:

What will you do if you have AK-47 rifle in your hands but you do not have money to buy food?. Understandably you will rob a bank.

No.

I would still practice patience even if I were to fall into hardship - sitting among ashes and potsherds, sores covering my body. I will not forgo my faith. I will put down the rifle and pray :

Oh Lord! Why does this happen to me?
I keep to the law.
I obeyed the governor.
I paid all my bills.
I paid all taxes.
I did no usury.

 

[wildfirepow]

CNBC: US May Face 'Armageddon' If China, Japan Don't Buy Debt

The US is too dependent on Japan and China buying up the country's debt and could face severe economic problems if that stops, Tiger Management founder and chairman Julian Robertson told CNBC.

"It's almost Armageddon if the Japanese and Chinese don't buy our debt,” Robertson said in an interview. "I don't know where we could get the money. I think we've let ourselves get in a terrible situation and I think we ought to try and get out of it."

Robertson said inflation is a big risk if foreign countries were to stop buying bonds.

“If the Chinese and Japanese stop buying our bonds, we could easily see [inflation] go to 15 to 20 percent,” he said. “It's not a question of the economy. It's a question of who will lend us the money if they don't. Imagine us getting ourselves in a situation where we're totally dependent on those two countries. It's crazy.”

Robertson said while he doesn’t think the Chinese will stop buying US bonds, the Japanese may eventually be forced to sell some of their long-term bonds.

“That's much worse than not buying,” he said. “The other thing is, they're buying almost exclusively short-term debt. And that's what we are offering, because we can't sell the long-term debt. And you know, the history has been that people who borrow short term really get burned.”

The only way to avoid the problem, he said, is to "grow and save our way out of it."

"The U.S. has to quit spending, cut back, start saving, and scale backward," Robertson said. "Until that happens, I don't think we're anywhere near out of the woods.”

Robertson is not very optimistic about the short-term.

“We're in for some real rough sledding,” he said. “ I really do think the recession is at least temporarily over. But we haven't addressed so many of our problems and we are borrowing so much money that we can't possibly pay it back, unless the Chinese and Japanese buy our bonds.”

http://www.cnbc.com/id/33004753

 

[intradaybill]

Quote from wildfirepow:

CNBC: US May Face 'Armageddon' If China, Japan Don't Buy Debt

I wonder about those people who are considered experts by the media and manage so much money but make such extraordinary stupid statements. Life must be a totally random process for them to have gotten where they are...

I have something to say to those people, a short and quick lesson in international economics and commerce.

China invests in the USA using currency it receives from USA in exchange for goods produced in China and purchased by USA consumers. You cannot do anythng with USD other than invest in in US denominated instruments if you are not planning to upset international commerce. If China attempts to exchange USD to other currencies then (a) USD will drop putitng upward pressure to China currency (b) USA will retaliate by raising import taxes on Chinese goods. The only option China has for keeping its economy going and not upsetting its biggest customer is to keep buying American bonds. Any other action will upset the balance, will force Chinese economy into a recession and probably into a severe depression.

It is to the best interest of the Chinese for USD to be strong and for USA to keep paying interest on the obligations they purchase while they are building their infrastructure and the economic activity is spreading from the shores to the rest of their vast country. It is to the best interest of the Chinese for the USA economy to be healthy and strong. This translates into more economic activity for them, higher employment rates and low inflation.

I really wonder about those high profile people that spew crap whenever they open their mouth. It is a really peculiar fact of life...

 

[mgabriel01]

Quote from ByLoSellHi:

When volatility returns to equity markets, and China pares back stimulus spending, the USD will be KING once again.

Count on it.

for a while, yes
if we don't get our own house in order though.......


anyone for term limits in both houses of congress?

 

[tradestrong]

Quote from intradaybill:



I really wonder about those high profile people that spew crap whenever they open their mouth. It is a really peculiar fact of life... [/B]

Didn't you hear? The "new global economy" is going to have all the commodity based economies exporting steel to each other in an infinite loop.

Never mind the fact that very little innovation comes out of the "emerging" markets. But no worries, like I said, they'll just export steel and then turnaround and import it and then turn around and export it and then turn around and import it.

PROBLEM SOLVED!!

 

[wildfirepow]

Barack Obama and his team have failed the USA with $82 Trillion of debts on and off the books.

http://usdebtclock.org/