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Pot notices kettle whistling…

November 10, 2010

OUCH! This is one of the problems with a less aggressive foreign policy….the other powers get restless AND cheeky

Politico:“The American growth model … is stuck in a deep crisis,” said German Finance Minister Wolfgang Schauble in a magazine interview over the weekend. “It doesn’t add up when Americans accuse the Chinese of currency manipulation, then, with the help of their central bank’s printing presses, artificially lower the value of the dollar.”….

Doesn’t it “look hypocritical,” Obama was asked at the news conference, to make that demand after the United States last week announced a $600 billion plan to boost U.S. economic growth that will have the effect of driving down the value of the dollar?

That left me feeling like a lightening bolt had struck nearby…anyone familiar with history between WWI and WWII should be feeling very uncomfortable, particularly with articles like “Stealth protectionism on the rise

Canada’s supposedly laissez-faire government has banned the purchase of Saskatchewan-based Potash Corp., by BHP Billiton, an Australian natural resources company. China has stopped shipments of so-called rare earth metals (a collection of 17 minerals used for manufacturing various products that are now in high demand) to Japan. But these and other forms of open protectionism pale in comparison to the decision by the Federal Reserve to pump another $600 billion into the economy through the purchase of government bonds

The economists have been puzzled and mystified as to the QE2 went off so poorly in terms of relationships with friendly countries

A half-dozen economists Monday said that the most puzzling thing about the breakdown in the China currency effort was the apparent failure by Treasury Secretary Timothy Geithner and Bernanke to anticipate how much the Fed intervention would anger Germany

HINT: “Ted Truman, a former Clinton administration Treasury official, said the Fed clearly wasn’t intending to drive down the dollar, which it could have done in more effective ways.”

That’s what worries me -It wasn’t supposed to work that way. It’s almost as if they don’t know how the finer things in life they enjoy came into existence – how excess production (i.e. TOO MUCH PROFIT) results in overall wealth and increases in leisure for all…. I could recommend a great book “Guns, Germs and Steel” or perhaps the VDH article here….”Stay worried” he says

Either way, there seem to be plenty of “oops, sorry – didn’t mean to tread on your toes,” and “hey, that wasn’t supposed to happen,” or “ZOINKS!”

Maybe the economic models were all designed by Acme Inc since they all seem to be doing things they weren’t SUPPOSED to do and NOT doing the things they were reported to be capable of. We’re apparently all guinea pigs in their economic labs….


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