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October 07, 2008


Rahul Deodhar

Well yes - but there is one problem - in no way US consumer is going to remain a consumer (to the extent she was i.e.) So exports are going to reduce no matter what.

China will ride to the rescue end u with roughly 4 trillion of US investment before the relationship tanks!

Tord Steiro

Or, China can play the good old role of the self-interested superpower. Hence the conditionality would look rather different, perhaps something like this:
1. Remove all export restrictions on hi-tech goods, especially military hardware.
2. Open up for foreign (Chinese) investment, in all sectors.
3. Restructuring of federal debt, and the implementation of a repayment plan that involves balanced/surplus budgeting.


Another possibility: not long ago President Hu proposed a "Louisiana Purchase" arrangement for Taiwan... (Check out http://justworldnews.org/archives/003117.html)


So let me understand - sell US bonds to get cash to lend to the US again? What kind of logic is that? Phd in economics doesn't count for much these days.

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