This is what happens when you elect fools whose only goal is to enrich their friends. How can we possibly finance our huge debt if no one wants dollar denominated assets? The answer is that we can not unless we raise interest rates to attract more investment. If we do that then we will kill what is left of our economy. Its a catch 22 brought to you by the economic policies of the Bush administration. What more proof do you need to understand that he has destroyed both our good name around the world and our economic future.
In financial market jargon, a "flight to quality" when times are uncertain used to be synonymous with "buy dollars." Not anymore.This is what happens when you borrow as muich as we have from foreign governments. You are now at their mercy and China could kill us without ever dropping a bomb.
Currency traders gave the U.S. dollar a thorough pounding Wednesday and pushed the value of the euro to $1.47, the highest on record. The Swiss franc rose to a 12-year high against the dollar, and the pound climbed to the value it reached 26 years ago.
In short, markets appeared firmly in the grip of a mood that seemed to scream for any investment other than the dollar, a reflection of a broad lack of confidence in a U.S. economy that could not seem to put the subprime mortgage crisis behind it. Unusually, powerful new Chinese investors appeared to endorse the idea that the U.S. currency was bound to fade as a result.
An unprecedented public badmouthing by the Chinese government - a colossal dollar investor by virtue of its $1.43 trillion in currency reserves, most of which are presumed to be denominated in dollars - helped drive the U.S. currency lower Wednesday.We are witnessing the death of the American middle class and the American way of life unless we act quickly to take back our government from these thugs. Time is running out.
"In terms of the structure of our foreign exchange reserves, we should take advantage of the appreciation of strong currencies to offset the depreciation of weak currencies," Cheng Siwei, vice chairman of the National People's Congress, said in Beijing on Wednesday, Reuters reported.