[extropy-chat] Extropian Scorecard

[Mike Lorrey]

--- Mike Lorrey <mlorrey at yahoo.com> wrote:

> 
> --- Brent Neal <brentn at freeshell.org> wrote:
> 
> >  (11/8/04 4:41) Mike Lorrey <mlorrey at yahoo.com> wrote:
> > 
> > >Meanwhile the
> > >international left will use its assets to leverage as much damage
> on
> > >the US financially as it can.
> > 
> > Do you really believe that the currencies markets are tools of the
> > left wing?  Does that mean that open markets are leftist too? Do
> > tell. Inquiring minds want to know.
> 
> One word: Soros,

Second word: China:
http://news.ft.com/cms/s/257979a6-30f4-11d9-a595-00000e2511c8.html
Dollar expected to fall amid China's rumoured selling
By Steve Johnson in London and Andrew Balls in Washington
Published: November 7 2004 19:43 | Last updated: November 7 2004 19:43

The dollar could slide still further, in spite of hitting an all-time
low against the euro last week in the wake of George W. Bush's
re-election, currency traders have said.

The dollar sell-off has resumed amid fears among traders that Mr Bush's
victory will bring four more years of widening US budget and current
account deficits, heightened geopolitical risks and a policy of "benign
neglect" of the dollar.

Many currency traders were taken aback on Friday when the greenback
fell in spite of bullish data showing the US economy created 337,000
jobs in October.

"If this can't cause the dollar to strengthen you have to tell me what
will. This is a big green light to sell the dollar," said David Bloom,
currency analyst at HSBC, as the greenback fell to a nine-year low in
trade-weighted terms.

The dollar's fall comes as the Federal Reserve is widely expected to
raise US interest rates by a quarter point to 2 per cent when it meets
on Wednesday and to signal that it will continue with a measured pace
of rate increases.

Speculative traders in Chicago last week racked up the highest number
of long-euro, short-dollar contracts on record. Options traders have
reported brisk business in euro calls - contracts to buy the euro at a
pre-determined rate.

However, the market has been rife with rumours that the latest wave of
selling has been led by foreign governments seeking to cut their
exposure to US assets.

India and Russia have reportedly been selling US assets, as well as
petrodollar-rich Middle Eastern investors.

China, which has $515bn of reserves, was also said to be selling
dollars and buying Asian currencies in readiness to switch the
renminbi's dollar peg to a basket arrangement, something Chinese
officials have increasingly hinted at. Any re-allocation could push the
dollar sharply lower and Treasury yields markedly higher.
---end quote---

As I expected (and have predicted repeatedly on this list in the last
two years), China will precede a move on Taiwan with a 'rearrangement'
of its dollar reserves (the US Dollar is the backing of its entire
money supply) to a mixed basket. Presented as ho-hum, this is intended
to further devaluate the US dollar to push the US further into an oil
crisis and make it difficult for the US to maintain its strategic oil
reserves, which would be so necessary if a war between the US and China
were to break out over Taiwan.

China is seeing that US military forces are currently at their limits
in the Iraq deployment and cannot handle a second regional or major war
without a nationwide draft and significant lag time for training
draftees. There is also significant domestic opposition to a draft in
the US, and so long as China does not attack US targets, this
opposition should remain high, and is likely being supported by left
wing maoist groups that run anti-war organizations like ANSWER.

China therefore thinks that this year is its opening, whether or not
Bush or Kerry is in office. Bush can't bring new weapons systems online
fast enough, or move overstressed military units into position in the
western pacific.

Depending on how rapidly China 'rearranges' its reserve mix of
currencies and dumps dollars on the market will determine how soon Bush
is forced to open the Strategic Oil Reserve for easing consumer prices.
As consumer consumption draws down the reserve, Bush will be also using
it up in bringing US forces home from Iraq as fast as possible and
trying to ship as many of them to the west coast as possible. 

Some troop planes and ships may simply redeploy directly to Taiwan from
Iraq, setting up a rear logistical and command area in Guam. Keep an
eye out for THEL deployments to Taiwan, Japan, South Korea, or Guam.
Guam especially will be vulnerable to ICBM attack from China and will
likely be a proving ground for the THEL in dealing with strategic
weapon trajectories as well.

=====
Mike Lorrey
Vice-Chair, 2nd District, Libertarian Party of NH
"Necessity is the plea for every infringement of human freedom.
It is the argument of tyrants; it is the creed of slaves."
                                      -William Pitt (1759-1806) 
Blog: http://www.xanga.com/home.aspx?user=Sadomikeyism


		
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