UNDERNEWS

Undernews is the online report of the Progressive Review, edited by Sam Smith, who has covered Washington during all or part of one quarter of America's presidencies and edited alternative journals since 1964. The Review has been on the web since 1995. See main page for full contents

March 13, 2009

CRASH TALK

Wall Street Journal - Premier Wen Jiabao voiced confidence in China's economy, saying his government's finances give it room to spend even more to support growth if needed, but expressed concern about the outlook for the U.S. and the safety of its Treasury bonds. . .

The public airing of his concerns reflect how the relationship between China and the U.S. has been evolving under the pressure of the financial crisis. For years the U.S. has pressed China to change the way it runs its economy, such as by opening up its financial system. But in the last year China's government has been increasingly vocal about what it sees as U.S. economic mismanagement. And as the U.S. government's largest creditor, it has become more assertive in trying to ensure its interests receive a hearing.

"We have lent a huge amount of money to the U.S., so of course we are concerned about the safety of our assets. Frankly speaking, I do have some worries," Mr. Wen said in response to a question. He did not offer specific suggestions on economic policy to the U.S. government, but called on it to "maintain its credibility, honor its commitments and guarantee the security of Chinese assets."

Mr. Wen did indicate that China would not be rash in making changes to its $1.946 trillion stockpile of foreign reserves, much of which is in U.S. dollars. While China is naturally looking out for its own interests, it will "at the same time also take international financial stability into consideration, because the two are inter-related," he said.

Dean Baker, Prospect - The value of the dollar plunged by almost 50 percent against the euro in the years from 2002 to 2008 (it has since recovered part of these losses). China eagerly bought up U.S. government bonds during this period, even though it was consistently losing money on its investment.

This history makes its sudden expression of concern about losing money on its dollar holdings so peculiar. This public expression of concern presumably has a political motive rather than reflecting the actual views of Chinese leader, which would more typically be expressed privately to their counterparts in the United States.

The media should have pointed this history out to readers and noted how extraordinary it is that such a statement would be made in public. The public nature of the statement is the real news, not the supposed "worry" about the future value of their investments.

Channel 4, DC -
Hundreds of people waited in line for the chance of grabbing a subsidized apartment in northwest Washington. Dozens of people began waiting Wednesday night and slept in lawn chairs on the sidewalk to ensure their spot on the waiting list. The Columbia Heights Village Apartments have several two-bedroom units opening up . . . The first 300 people in line will be put on a waiting list and go through a screening process. Applicants must meet maximum income requirements to qualify for an apartment.

JUSTICE & FREEDOM

Slashdot
- The National Security Archive has awarded its 2009 Rosemary Award to the FBI for worst freedom of information performance. Previous winners have been the CIA and the Treasury. The NSA notes that 'the FBI's reports to Congress show that the bureau is unable to find any records in response to two-thirds of its incoming FOIA requests on average over the past four years, when the other major government agencies averaged only a 13% "no records" response to public requests.' The FBI's explanation, according to the NSA, is that 'files are indexed only by reference terms that have to be manually applied by individual agents,' and even then, 'agents don't always index all relevant terms.' Furthermore, 'unless a requester specifically asks for a broader search, the FBI will only look in a central database of electronic file names at FBI headquarters in Washington.' Any search will therefore 'miss any internal or cross-references to people who are not the subject of an investigation, any records stored at other FBI offices around the country, and any records created before 1970."

Cook County, IL
is now requiring homeowners to provide a thumb print before their house is sold

3 Comments:

Anonymous Anonymous said...

It's a pungent, bittersweet irony that we sold huge chunks of our(sic) country to China at a firesale price. Seeing as how went broke wasting all our money in the pentagon system which has been ammassing stockpiles of weapons that mostly don't work to protect us from the chinese coming in here and taking over.

The times they are a changin'

March 13, 2009 7:01 PM  
Anonymous Anonymous said...

The joke's on China. They'll be paid back in massively devalued dollars.

March 14, 2009 5:27 PM  
Anonymous Anonymous said...

China should be worried about their dangerous over investment in US Treasury obligations. Washington ’s long-term choice is either repudiation or monetization. For monetization to be effective, the depreciation in the dollar would have to be substantial and this in turn would dramatically raise prices of imports for American consumers which would mean a tremendous drop in foreign imports. Debt monetization would cause more disruption to exporting nations than selective repudiation of Treasury debt.

Washington has bailed out the banks, Wall Street & their Washington special interests and much of the cost is added to the national debt to by paid by this and future generations while real estate and investments continue to fall. Find out what a growing repudiate the debt movement could mean for treasury bonds, the dollar, gold and the stock market.

The Campaign to Cancel the Washington National Debt By 12/22/2013 Constitutional Amendment is starting now in the U.S. See: http://www.facebook.com/group.php?gid=67594690498&ref=ts

Thanks,

Ron Holland

March 15, 2009 12:04 PM  

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