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Financial crisis: full force of US downgrade is felt around the world

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posted on Aug, 8 2011 @ 02:38 AM
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I wouldn't place too much emphasis on stock markets. They go up and they go down ad infinitum. Usually the downs are deliberately engineered and orchestrated so that the sharks can make a killing on cheap shares. However the computers that control the exchanges around the world will NEVER allow a repeat of the 1930s crash cause they just shut trading down when activity becomes suspicious (i.e. the sharks get too greedy) or goes beyond preprogrammed situational thresholds.Twenty years ago, when the US got a cold, the rest of the world go the flu. Not anymore. Most advanced economies (and advancing ones like China and India) have diversified their investments so it spreads the risk. That's not saying will not lose anything, just not as much as they would have 20 yrs ago. The US could go down the tubes economically now and no one would blink. Seriously... so think about this folks....




posted on Aug, 8 2011 @ 02:42 AM
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reply to post by silent thunder
 


Very good points you bring up there. It does seem a little silly to me that a 'credit rating' can determine a countries future and that one body is able to determine this rating.....



posted on Aug, 8 2011 @ 02:58 AM
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reply to post by Janky Red
 


Agreed.



Originally posted by sir_slide
reply to post by OldCorp
 


You'd actually be surprised what they produce, almost everything is made in China. Also you'd actually be surprised at how affluent Chinese society has become, my family was there recently I was shocked. They also have a giant population who could easily be utilized in an armed conflict as they're petrified of their government.

I think a lot of people may not comprehend the true nature of modern Chinese society, they're doing pretty well. Another thing is that it is only because many goods are made in China that they come so cheaply to the west, if they were to cut off your imports then you may suddenly find most products taking a sudden price hike, coupled with the decline of the dollar this is not good news for people in the US.

Cheers


My friend, WHAT do they produce? I was serious with my Wal-mart quip. They make great $7 beach chairs, $3 ice chests, and their fireworks are state of the art; but what do they produce that is actually WORTH anything? The US feeds the world with it's grain surplus, we lead the world in technological innovations, and our military is second to none.

IMHO, China is a paper tiger. If it wasn't for the fact that the US was their single largest trading partner, they'd be up snipcreek without a paddle. I say SCREW WAL-MART AND China! Wallyworld hasn't been worth a snip since Sam Walton's "Made in America" philosophy was abandoned by his children (the ungrateful, greedy bastards.)

I ALWAYS buy from local merchants if the product I need is available in their stores, even if it costs a dollar or two more. The only reason I shop at Wal-mart is for their $12 sneakers.

Getting back to China: what do they manufacture that the world needs? NOTHING! We (the US) would be just as well off if we bought our big screen TVs from Latin America. At least then we would know that our hard-earned dollars weren't going to a country bent on our destruction.
edit on 8/8/2011 by OldCorp because: my "L" key sticks



posted on Aug, 8 2011 @ 03:03 AM
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reply to post by OldCorp
 


Walk into any store other than Wal-Mart and take a look at where their products are made. Have a local auto parts store? Go take a look at where those parts are made. I work in auto parts. 95% of the parts are made in either China or Mexico. Hell, even our American flags are made in China. I think the better question is what does China NOT produce.

I agree with you though that we should tell them to take a flying leap. In fact, I think we should tell the whole world to shove it.



posted on Aug, 8 2011 @ 03:03 AM
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What China produces is a currency you can put faith into. The markets are going crazy because people are losing faith in the faith based currency of the United States. If the currency isn't backed by anything then it's no different than stock.



posted on Aug, 8 2011 @ 03:05 AM
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Originally posted by OldCorp



My friend, WHAT do they produce? I was serious with my Wal-mart quip. They make great $7 beach chairs, $3 ice chests, and their fireworks are state of the art; but what do they produce that is actually WORTH anything?


Well...China is the second-largest economy after the US now, so they do seem to be producing a lot more than beach chairs and ice chests.

For example:


Industry and construction account for 46.8[99]% of China's GDP. In 2009 around 8% of the total manufacturing output in the world came from China itself and China ranked third worldwide in industrial output that year (first was EU and second US). Research by IHS Global Insight states that in 2010 China contributed to 19,8% of world's manufacturing output and became the largest manufacturer in the world that year, after the US had held that position for about 110 years.[100][101]

Major industries include mining and ore processing; iron and steel; aluminium; coal; machinery; armaments; textiles and apparel; petroleum; cement; chemical; fertilizers; food processing; automobiles and other transportation equipment including rail cars and locomotives, ships, and aircraft; consumer products including footwear, toys, and electronics; telecommunications and information technology. China has become a preferred destination for the relocation of global manufacturing facilities. Its strength as an export platform has contributed to incomes and employment in China. The state-owned sector still accounts for about 30% of GDP. In recent years, authorities have been giving greater attention to the management of state assets—both in the financial market as well as among state-owned-enterprises—and progress has been noteworthy.

Since the founding of the People's Republic, industrial development has been given considerable attention. Among the various industrial branches the machine-building and metallurgical industries have received the highest priority. These two areas alone now account for about 20–30 percent of the total gross value of industrial output.[102] In these, as in most other areas of industry, however, innovation has generally suffered at the hands of a system that has rewarded increases in gross output rather than improvements in variety, sophistication and quality. China, therefore, still imports significant quantities of specialized steels. Overall industrial output has grown at an average rate of more than 10 percent per year, having surpassed all other sectors in economic growth and degree of modernization.[103] Some heavy industries and products deemed to be of national strategic importance remain state-owned, but an increasing proportion of lighter and consumer-oriented manufacturing firms are privately held or are private-state joint ventures.

The predominant focus of development in the chemical industry is to expand the output of chemical fertilizers, plastics, and synthetic fibers. The growth of this industry has placed China among the world's leading producers of nitrogenous fertilizers. In the consumer goods sector the main emphasis is on textiles and clothing, which also form an important part of China's exports. Textile manufacturing, a rapidly growing proportion of which consists of synthetics, account for about 10 percent of the gross industrial output and continues to be important, but less so than before. The industry tends to be scattered throughout the country, but there are a number of important textile centers, including Shanghai, Guangzhou, and Harbin.[104][105]

Major state industries are iron, steel, coal, machine building, light industrial products, armaments, and textiles. These industries completed a decade of reform (1979–1989) with little substantial management change. Prior to 1978, most output was produced by state-owned enterprises. As a result of the economic reforms that followed, there was a significant increase in production by enterprises sponsored by local governments, especially townships and villages, and, increasingly, by private entrepreneurs and foreign investors. The 1996 industrial census revealed that there were 7,342,000 industrial enterprises at the end of 1995; total employment in industrial enterprises was approximately 147 million. The 1999 industrial census revealed that there were 7,930,000 industrial enterprises at the end of 1999 (including small-scale town and village enterprises); total employment in state-owned industrial enterprises was about 24 million. The automobile industry has grown rapidly since 2000, as has the petrochemical industry. Machinery and electronic products became China's main exports. China is the world's leading manufacturer of chemical fertilizers, cement, and steel. By 2002 the share in gross industrial output by state-owned and state-holding industries had decreased to 41%, and the state-owned companies themselves contributed only 16% of China's industrial output.

China's construction sector has grown substantially since the early 1980s. In the 21st century, investment in capital construction has experienced major annual increases. In 2001 investments increased 8.5% over the previous year. In 2002 there was a 16.4% increase, followed by a 30% increase in 2003. The manufacturing sector produced 44.1% of GDP in 2004 and accounted for 11.3% of total employment in 2002. Industry and construction produced 53.1% of China's GDP in 2005. Industry (including mining, manufacturing, construction, and power) contributed 52.9% of GDP in 2004 and occupied 22.5% of the workforce.

Energy production has increased rapidly, but it still falls considerably short of demand. This is partly due to artificial energy prices that have been held so low that industries have had few incentives to conserve. Coal provides about 75–80 percent of China's energy consumption. Petroleum production, which began growing rapidly from an extremely low base in the early 1960s, has basically remained at the same level since the late 1970s. There are large petroleum reserves in the inaccessible northwest and potentially significant offshore petroleum deposits, but about half of the country's oil production still comes from the major Daqing oilfield in the northeast. China has much, and partially undeveloped, hydroelectric power potential and natural gas reserves. The government has made plans to develop nuclear power plants in the coastal and western regions (see Nuclear power in China).

Overall, the distribution of industry remains very uneven, despite serious efforts from the mid-1950s to the late 1970s to build up industry in the interior at the cost of the major cities on the east coast. While percentage growth of industry in the interior provinces generally greatly exceeded that of the coastal areas, the far larger initial industrial base of the latter has meant that a few coastal regions have continued to dominate China's industrial economy. The establishment of special economic zones in coastal areas only heightened this disparity. Shanghai by itself accounts for about 8–10 percent of China's gross value of industrial output,[105] and the east coast accounts for about 60 percent of the national industrial output.[102] The rate of industrialization increased and diversified after the early 1990s. Notable were the development of aerospace, aircraft, and automobile manufacturing. In addition, China expanded rapidly into the production of pharmaceuticals, software, semiconductors, electronics, and precision equipment.

Source:
en.wikipedia.org...'s_Republic_of_China#Industry_and_manufacturing


That said, I agree with you they are overrated...they will stumble soon enough, they have many millions living in stone-age conditions.

But they've come quite a way, from beachballs to semiconductors...
edit on 8-8-2011 by Partygirl because: (no reason given)



posted on Aug, 8 2011 @ 03:07 AM
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Originally posted by Bleeeeep
What China produces is a currency you can put faith into. The markets are going crazy because people are losing faith in the faith based currency of the United States. If the currency isn't backed by anything then it's no different than stock.


China is every bit as corrupt as the US.

They just don't air out their dirty laundry in public.



posted on Aug, 8 2011 @ 03:10 AM
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reply to post by OldCorp
 


Most of your clothes for one, computers, electronics, and many other valuable things. I think you're totally right when you say screw Walmart, absolutely screw walmart, but you might find that a lot of families won't be able to afford the basic things that they rely on (affordable clothes, furniture etc etc) soon, especially with how the market in the US is doing. That's kinda my point. Food prices will also be effected, I buy all my produce from local markets too and I can see what you mean, but I just don't think you can deny that most consumer products that people rely on are made in China. Maybe people would be better off without these things.....



posted on Aug, 8 2011 @ 03:11 AM
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Originally posted by OldCorp
editby]edit on 8/8/2011 by OldCorp because: my "L" key sticks


That sticky "L" key is probably " Made In China " along with many of the components of the PC you're using right now .

So you think you can just give the finger to China or Asia and buy from South America ?

LoL covers that .



posted on Aug, 8 2011 @ 03:11 AM
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reply to post by Partygirl
 


You're probably right, but its not just those countries I would assume. One could argue all countries are corrupt. Nonetheless, you can put more faith into China's currency than the United States for now.



posted on Aug, 8 2011 @ 03:17 AM
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reply to post by Partygirl
 


Thanks for the response!

Certainly seems to me that they produce far more than cheap outdoor furniture, I was trying to find something like that. Thanks again for presenting it.



posted on Aug, 8 2011 @ 03:17 AM
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Originally posted by sir_slide
reply to post by OldCorp
 


Most of your clothes for one, computers, electronics, and many other valuable things. I think you're totally right when you say screw Walmart, absolutely screw walmart, but you might find that a lot of families won't be able to afford the basic things that they rely on (affordable clothes, furniture etc etc) soon, especially with how the market in the US is doing. That's kinda my point. Food prices will also be effected, I buy all my produce from local markets too and I can see what you mean, but I just don't think you can deny that most consumer products that people rely on are made in China. Maybe people would be better off without these things.....


I think we would be better without China's cheap, screwed up bull products.

America went down the tubes the moment we gave in to the trend of loads of cheap, fast goods.

I'll take an American anything over a Chinese anything,

except maybe Bruce Lee.

I wish we could get our crap together here.

Maybe our political efforts would be better invested on a Buy American only, grass roots campaign.

Imagine if we spent the same amount of time promoting our good stuff, as opposed to pointing the finger
all day everyday...



posted on Aug, 8 2011 @ 03:21 AM
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Originally posted by Bleeeeep
What China produces is a currency you can put faith into. The markets are going crazy because people are losing faith in the faith based currency of the United States. If the currency isn't backed by anything then it's no different than stock.



China only produces half assed stuff.

If you can cut a corner or #$%& somebody, they will go for it, sort of like American Banks and
Insurance companies


American goods, now that is the real deal IMO



posted on Aug, 8 2011 @ 03:26 AM
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reply to post by Janky Red
 


Yeah that's my opinion too but I think if you cash in your usd for yuan and wait awhile you can buy more crappy Chinese produces than you could if you hadn't exchanged currency. Long live cheap stuff!



posted on Aug, 8 2011 @ 03:27 AM
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Here's a little update on how the Euro stocks are going

This is a few minutes after they opened



They had a little help with the European Central Bank buying sovereign bonds (helped some get up to +4%). Spanish and Italian banks were helped the most by this.

Europe stocks rise as ECB pledges bond buys


LONDON (MarketWatch) — European stock markets rallied Monday as a pledge from the European Central Bank to buy sovereign bonds sent bank stocks soaring and helped investors shrug off the decision by Standard & Poor’s to downgrade the U.S. credit rating.


About 30 minutes later, here is where they are



FTSE MiB and IBEX are doing well, but it looks like the others have passed the ECB bond buying pledge.



posted on Aug, 8 2011 @ 03:28 AM
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reply to post by Janky Red
 


While I do tend to agree in regards to a vast majority of the things made in China and the consumerist ideology behind amassing such things I just can't see how it is possible at this point to go American again. Would it be possible economically? It seems doubtful, and while many great things are made in the USA (my Gibson les paul being one of them) it does seem like there is a heavy reliance on imports that may not be able to be reversed at any point in the future. There is an economic collapse and it doesn't seem like this can happen.



posted on Aug, 8 2011 @ 03:36 AM
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reply to post by Partygirl
 


You know I love you right?
You're one of the most intelligent posters on ATS...

But what does China produce for EXPORT? Everything listed in the article you quoted was for domestic consumption. China produces nothing but chatchakas for the rest of the world.

reply to post by sir_slide
 


Yes, China does produce a lot of items we use every day; BUT I - along with many Americans - would much rather BUY AMERICAN when we can, even if the sticker price is a bit higher than something made in China. If we had factories that produced the everyday items we find such a bargain at Wal-mart, we'd be much better off (I'm specifically referring to the fact that American, as opposed to Chinese, workers would be bringing home the paychecks.) As I said before, at one time Sam Walton's Wal-mart stores proudly displayed "Made in the USA" banners prominently throughout the store. These days, nearly everything Wal-mart sells is made in China.

IMO, if these items were "Made in the USA," not only would our economy be better off with the added jobs required to manufacture them, but we wouldn't be propping up an enemy that is salivating at the prospect of our demise.


Originally posted by DevilsApprentice

That sticky "L" key is probably " Made In China " along with many of the components of the PC you're using right now .

So you think you can just give the finger to China or Asia and buy from South America ?

LoL covers that .


I blame my cat (an American short-hair.) She crawled onto my laptop and her claws ripped the "L" key off of the keyboard. I used a bit of "Redneck Engineering" to fix the problem (I glued the "L" key down onto a shooting range earplug to give it some "bounce.")
I guess at some point I'll have to replace it; with a keyboard made in TAIWAN!




posted on Aug, 8 2011 @ 03:40 AM
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reply to post by sir_slide
 





Many cannot see the reality of this crisis for the world and not just the United States, something absolutely needs to be done. But what??!!


NOTHING! We and the world need to take our medicine. The longer we put it off the more painful it will be and the more chance we will descend onto chaos. The politicians refused to do the right thing and I don't think most of them even know what the right thing is and the rest are in the banksters pockets. So let the markets correct and clear out all the bad and phoney debt/money and lets take the medicine!

If we had done that in 2008 we would be on our way to full recovery by now....


edit on 8-8-2011 by hawkiye because: (no reason given)



posted on Aug, 8 2011 @ 03:46 AM
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reply to post by hawkiye
 


That's not taking the medicine. That's drinking the kool-aid. There's got to be hundreds of things we can do to fix the situation. Just off the top of my head, we could legalize some illegal drugs and tax the hell out of them. Then pay debts with that.



posted on Aug, 8 2011 @ 03:47 AM
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Originally posted by OldCorp
I guess at some point I'll have to replace it; with a keyboard made in TAIWAN!



I wonder how long till the Mainland takes back their wayward child


Did you read this ...ho hum


www.abovetopsecret.com...

Have fun mate



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