Beta Key Giveaway Week 3: Winners have been selected!

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  1. #21
    Quote Originally Posted by Skroe View Post
    I mean, not to be a dick about it, but we're 18 years into "it's coming five years down the pipe, guys, really this time". It isn't going to happen.



    The dollar's been operating within a 5%-8% band for the past 20 years.

    The Euro is a fine and necessary alternative, but it mostly ate into the Yen as Japan's economy declined, after absorbing the Mark and the Franc. And even just a couple of years back, when the IMF's SDR was reformed to incorporate the Chininese rembini, it ate up 7% of the Euro's share, 1% of the Yen's share and 3% of the Pound's share... all while eating up 0.2% for the Dollar.




    It's worth repeating that despite political nonsense, despite the wars, despite a widdening gap between rich and poor and flat wages, despite Trump, the US is actually the wealthiest it's ever been, and it is this wealth that is the foundation of our global financial power.
    And it's perhaps sadly more trustworthy than the EU. Perhaps if they had been half as aggresive in dealing with the crisis as Obama was things would be a bit different.

  2. #22
    Quote Originally Posted by Nymrohd View Post
    And it's perhaps sadly more trustworthy than the EU. Perhaps if they had been half as aggresive in dealing with the crisis as Obama was things would be a bit different.
    The challenge they were facing was simply fundamentally different. America is one country and the EU is many. On some issues, Americans bite their lip spending money for the sake of other Americans. For all the flag waving and patriotism, they do it, but they don't love it. Witness, for example, disaster relief.

    European identity is more prevalent among the young in Europe than the old, but it's still... what... 28 different countries and cultures and a lot of messy history? Many New Yorkers do pick up and move to Florida. How many Germans really move to Greece or Italy? I pity Europe. Their problem was harder. But then again, as I've been saying here for years, the European Union is the most important single political creation since the founding of the United States.

    It must succeed.

  3. #23
    Quote Originally Posted by Skroe View Post
    The challenge they were facing was simply fundamentally different. America is one country and the EU is many. On some issues, Americans bite their lip spending money for the sake of other Americans. For all the flag waving and patriotism, they do it, but they don't love it. Witness, for example, disaster relief.

    European identity is more prevalent among the young in Europe than the old, but it's still... what... 28 different countries and cultures and a lot of messy history? Many New Yorkers do pick up and move to Florida. How many Germans really move to Greece or Italy? I pity Europe. Their problem was harder. But then again, as I've been saying here for years, the European Union is the most important single political creation since the founding of the United States.

    It must succeed.
    It'd help if you stopped sabotaging it from the other side of the Atlantic. Can you please take Bannon back?

  4. #24
    Now you have a president that is so stupid he thinks the US can just declare bankruptcy and walk away from international debt, because he's done it so many times as a private citizen.

    So it's no longer an issue, obviously.

  5. #25
    Quote Originally Posted by Nymrohd View Post
    It'd help if you stopped sabotaging it from the other side of the Atlantic. Can you please take Bannon back?
    Pardon our mess. It's going to take a couple of years more to clean up. We fucked up bad.

    We'll make it up to you.

  6. #26
    Quote Originally Posted by Skroe View Post
    The challenge they were facing was simply fundamentally different. America is one country and the EU is many.
    Not arguing, but would love to see some states-rights sovereignists show up and start spewing their bullshit over this point.
    Last edited by Heladys; 2018-03-14 at 08:03 PM. Reason: stupid fucking forum

  7. #27
    Quote Originally Posted by Mitten View Post
    This happened. China has sold a good amount of our debt and the economy did not crash, interest rates were still low.
    Very misleading graph.

    Plus, is it really? I'd be surprised if people actually knew this fact. You'd have to ask someone who previously used the talking point why they stopped.

    - - - Updated - - -

    Quote Originally Posted by Nymrohd View Post
    I mean for China to actually hurt the US by dumping debt, they'd need to dump so much that they would hurt themselves first and they are quite more vulnerable than the US is.
    No. The US would be directly effected whereas China would be effected by a factor of a factor.. of a factor.

    - - - Updated - - -

    Quote Originally Posted by Zan15 View Post
    1 trillion is not exactly a bone crushing amount, since demand for US debt easily covered those sales.

    So the fact that the total amount they own is not even that crushing relative to the total amount and to the amount that is sold yearly. they could dump it all and as long as they did not do it overnight, we would be just fine.....of course dumping it that fast is next to impossible and would actually net us a lot of extra money we would not have to pay them
    That final part is not true.

    When China sells their debt they aren't selling it to America, they are selling it to other investors. That just means America has to pay someone else.

    It also means that China is DIRECTLY competing against the US Treasury as a "market" to purchase US debt.

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    Quote Originally Posted by Skroe View Post
    Not to mention demand for US debt is and has long been, greatly exceeding supply.

    When most countries issue bonds, it takes weeks to sell through them. Some fail even in that time span. The US spent most of the past 15 years building a high-speed data link to major regular buyers just so they could purchase debt as soon as it goes up on sale, in a fraction of a second. As a result the US ability to raise money through debt happens instantly. That is the magnitude of demand.

    THe biggest long term risk is that if the US sustains many years of enormous deficits - on the scale of $1 trillion per year - if it'll lead to a sustained loosening of demand. If global development keeps apace - that is to say, newly rich(er) countries start becoming more frequent and larger buyers, as China and others have become, then it might not.

    The sustainability of US debt growth in other words, is directly connected to what exactly the limits on global growth are, if there indeed any at all.
    We actually increased rates very recently because in the past month they didn't sell instantaneously.

    This isn't that big of a deal, but it is a peculiarity.

  8. #28
    Quote Originally Posted by Aurinaux View Post
    Very misleading graph.






    That final part is not true.

    When China sells their debt they aren't selling it to America, they are selling it to other investors. That just means America has to pay someone else.

    It also means that China is DIRECTLY competing against the US Treasury as a "market" to purchase US debt.

    - - - Updated - - -

    .

    If they sell us treasuries its back to the US and they suffer a penalty for selling before maturity. We are not talking about their issuance of their own debt

  9. #29
    Quote Originally Posted by Zan15 View Post
    If they sell us treasuries its back to the US and they suffer a penalty for selling before maturity. We are not talking about their issuance of their own debt
    That's not true. How do you think bonds yield a negative rate? It's not because the distributions from the issuing country are negative...

    You aren't familiar with this asset class.

  10. #30
    The Insane Breccia's Avatar
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    Quote Originally Posted by Skroe View Post
    (China's share)
    Nineteen percent of the $6.3 trillion in Treasury bills, notes, and bonds held by foreign countries. $20 trillion is owned by the US in some way. That means China holds 4.5% or so of the total US debt.

    China has been reducing its portion faster than Japan, the #2 foreign holder.

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