Yahoo! has published an article online referencing Kuwait's daily Al-Seyassah. Its reported that the US is seeking approximately $300 billion in loans from the middle east to help support loaning the money out to failing American businesses.
The hypocrisy of this is amazing. The main reason being argued by Obama and his supporters for removing America's dependence on Middle Eastern oil is to protect national security and prevent future wars. Hopefully Obama manages this goal so that the US will only be indebted to the middle east for BILLIONS OF DOLLARS. As they are with China and Japan.
Of course, this would be a real good deal for the US if they are provided the loans, as Bernanke can just continue printing the money to pay off the debt. If the arabs are smart, they'll request repayment in gold only.
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4 comments:
If the Arab request repayments in Gold that would destroy their economy: which is completely dependent on Western car economies. Vicious circle, eh?
If they are smart they simply won't loan the money. However, I don't think Kuwait has much of a choice considering their indebtedness to the US.
Course, if they dont lend it, what happens to their economy if their biggest customer can't buy their product? Vicious circle, eh?
Funny, Iran just moved billions of reserves from euros to gold, and they're surviving.
China consumes more oil than the US and will continue to do so as their economy grows.
When the US economy collapses, oil prices will fall in the short-term, they will quickly rise though after the world has had time to react to the US collapsing. Only 300 million people in the US, they've been consuming more than their share, and they've been borrowing to do it.
You still see the world as one that is dependent on the US economy. It is not. The US is becoming a drain on the world economy. How does it benefit the arab's the lend the US hundreds of billions of dollars just to give back to buy oil, and then not have enough to pay interest because the US economy suffers a huge trade deficit? It doesn't.
"Funny, Iran just moved billions of reserves from euros to gold, and they're surviving."
Yes, reserves. Unfortunately, you can't exchange future profits for gold before you make it.
"China consumes more oil than the US and will continue to do so as their economy grows."
Still not as much as Europe, N.A., Japan, and Korea combined. Besides, where do you think China's wealth comes from? Vicious circle, eh?
"When the US economy collapses, oil prices will fall in the short-term, they will quickly rise though after the world has had time to react to the US collapsing."
That's what you don't understand. Everything is interlinked. If the US collapsed, so does Korea and Canada, and a huge part of Japan. China will suffer a massive recession, and if Europe follows suit, all their satellites will fall as well.
"Only 300 million people in the US, they've been consuming more than their share, and they've been borrowing to do it."
Not all of them. A lot of the problem has to do with jobs moving overseas. BUT LET'S NOT REMEMBER THAT FACT!
"You still see the world as one that is dependent on the US economy. It is not. The US is becoming a drain on the world economy."
Um, okay, Josh! 70% of the Korean economy is dependent on the US and 95% of the Canadian. The Chinese economy? Got at least be 30-40%. And if Europe goes? Well..
"How does it benefit the arab's the lend the US hundreds of billions of dollars just to give back to buy oil, and then not have enough to pay interest because the US economy suffers a huge trade deficit? It doesn't."
Because an economy is like a big circle, Josh. Their profits are directly the result of consumer spending. If they prop-up the US, and even lose a bit to the US paying them back in paper currency, then they will probably still profit more in the long-run. Of course, if I were them, and most of my population was super rich anyway, I might not do it... Course, if the factories aren't producing my money will be worthless, because the desert cant make me products!
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