Re: US on the rocks. Rank Order - Current account balance

On Feb 29, 6:17 pm, Tchiowa <tchio...@xxxxxxxxxxx> wrote:
On Feb 28, 7:10 pm, goodsoldierschweik <goodsoldierschw...@xxxxxxxxx>
wrote:



On Feb 28, 6:34 pm, Tchiowa <tchio...@xxxxxxxxxxx> wrote:
No. That does not follow.

2 problems with your logic.

1) If the countries that collected the money held the money that would
be true. But in fact the countries (like China) are returning most of
the money in the form of investments. So the money comes back.

2) The domestic money supply can be increased if wealth is created.
Again, a powerful domestic economy solves that.

You are rationalizing.

First, we are talking about current accounts. There is no guarantee
that a country with a positive current account must/will invest in a
country that has a negative current account, thus your first statement
is simply pie in the sky.

No, there is no guarantee. But in fact that is what is happening. It's
not pie in the sky. It's today's reality

But you set forth that the coountry with the positive balance WOULD
invest in the deficient country. Now you admit that it isn't guarnteed
but is happening. But you neglect that if a better investment were to
arise the money would no longer flow back to the deficient country...

In short you are evading facts in order to support your untenable
position..


Secondly, when you state that China is "investing" in the U.S. what is
actually happening is that they are buying bits and pieces of the U.S.
and thus accelerating the speed with which money flows out. i.e., if a
foreign country buys, say, 10% of Company 'X" it simply means that 10%
of company X's profits flow to the foreign company rather then into
the local economy; in addition to the positive balance of payments it
enjoys from their export/import trade.

So? That doesn't create debt. Money flows. That's a *GOOD* thing. A
*VERY* good thing.

You apparently know little about stocks. Stocks are offered for sale.
someone buys them. The only way that the foreign would add anything to
the pot is by buying a stock that domestic buyers wouldn't buy.

Quite frankly it is rather futile to discuss economics with you. you
apparently don't understand economics; don't listen to economists and
don't want to learn.

In short, you remind me of little David who was taking part in a
parade. His mother, watching the parade, proudly pointed out her son,
"Look! that's my David and look, everyone is out of step except
David".

Don't bother to answer since it is obvious that God has a great sense
of humor because he created idiots like you, to entertain everyone
else, and it is a waste of my time to discuss a serious subject with a
fool.

cheers

..


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