[TUF]Catbox wrote:
AussieReaper wrote:
Yeah, I never expected you to enlighten us all with your American financial system which involves no foreign trade.
Just waiting for your enlightenment... help us out of this problem... or just argue for the sake of arguing...like most of your posts...lol
Fine.
You need China to bailout the world banks. America is focusing on it's own banks. Britain likewise. A lot of toxic asset and bad bank credit is tied up in foreign investments however. American banks borrowed from European banks who still have bad debt.
If America were to start bailing out foreign countries banks you are going to cause your own dollar to fall significantly. If you use China to buy up the bad assets you have a much greater chance of recovering your own banks at home and abroad.
You are already owning China somewhere in the vicinity of two and a half trillion dollars. Borrowing more is going to burden America in the future. The G20 proposals is an attempt to get China to buy up some bad investments owed by banks globally without owing that money back to America or another power.
The belief is that China is in less position to bargain if they cannot make a return on their already huge investment into America and other world economies. The soon China kick starts the world economy through the International Monetary Fund among others, the sooner China can start collecting on it's debt.
China does not have the luxury of a self sustaining economy when the rest of the world collapses. They know this, and know that for the time being they are in a strong position, but it might not last. If that debt owed cannot be repaid they are then in debt two and a half trillion US dollars.
This solution is going to be pushed at the G20 summit. Germany and France are reluctant to do so, because they do not wish to have domestic banks bailed out by a foreign country, let alone China. They are in a slightly better position than other European powers, and feel they can weather the storm, albeit with high inflationary pressure with the bailouts they propose for their own economies.
So please, tell me about your proposal. The one which started with the line:
[TUF]Catbox wrote:
and i still think we should have our own financial system here in the US and the rest of the world can have theirs also...
