Yesterday, China Vice Premier Wang Qishan urged the U.S. to get a handle on its soaring debt to protect the value of the dollar. “As a major reserve currency-issuing country in the world, the U.S. should balance and properly handle the dollar’s supply,” Mr. Wang said through an interpreter. Well put.
via The Customer Is Right — Obama and China – WSJ.com.
I am not one to invest in one’s enemies, and we should not kid ourselves about the worldwide objectives of the Middle Kingdom. But even enemies speak truth and this is a case in point.
We need to guard the value of the Dollar for our own good, to hell with the value of the Chinese investment portfolio. The Dollar is in a long term decline, that is why you see expressions like ‘in current dollars’ or ’2009 dollars’ in news stories.
If the dollar declines at 3% a year that is lost purchasing power on every dollar in your wallet. So if you get 5% on your investments your real return is 2% pre tax. I remember gasoline at 30 cents a gallon, that same gallon today is $2.47. Much of that is declining dollars.
See a previous post on oil prices tagged above.
Our federal government needs to protect the currency, that is it’s primary job. We need to see that they do it, or we will deserve what we get.
Wow this is a great resource.. I’m enjoying it.. good article
This post is 18 months old, but is as relevant today as the day it was written. Thanks for visiting.