How do you tax credit card interest over 15%...?

[spartacus]

There are two ways to pay a deficit, you either cut spending or you generate more revenues (taxes).

 

not if you are the Federal govt

 

the 3rd way is to have your independent bank (which is neither a Federal agency or backed by reserves) simply print more money.

 

this continues its sole purpose of decreasing the purchasing power of the dollar - which has lost 95% of its value since the Federal Reserve was created.

[Magox]

not if you are the Federal govt

 

the 3rd way is to have your independent bank (which is neither a Federal agency or backed by reserves) simply print more money.

 

this continues its sole purpose of decreasing the purchasing power of the dollar - which has lost 95% of its value since the Federal Reserve was created.

The money that is printed through the federal reserve is not intended to directly go towards paying down the deficit.

 

There is a philosophy for the devaluation of the dollar where the theory behind is it through devaluation of our currency it does make our goods and services produced here in the U.S cheaper abroad, creating a higher demand for our products and therefore adding to our ability to generate more tax revenues through exports .

 

This is one of the criticisms that we and the majority of the developed nations have against China. They have artificially kept their currency cheap making their goods in our countries view, unfairly competitive. Now we can't really criticize them as much as we would like to, because they are funding our stimulus and bailout packages through their investments in treasuries. In reality, I don't believe that their currency "manipulation" tactics is their biggest advantage they have over the rest of the developed world when it comes to exporting goods, I believe it to be their input costs, specially on the labor front, along with all the incentives and tax breaks that their government afford to Chinese entrepeneurs in attempt to spur their rapid expansion.

 

I understand the philosophy of devaluing the dollar, and it may be one of the best short term options that we have to attempt to increase exporting our goods and services and paying down our deficit, but I think it is a disastrous long term solution.

 

I would think that one of the best ways we could pay off this massive deficit would be to gear up for the expansion of global growth, by becoming more a nation of producers. There are definitely a lot of new, eager people in this world, specially in the emerging markets that are set to contribute through becoming consumers of products. The only problem is that instead of gearing up here in the U.S, we have been sizing down. Industries such as the auto, banking and commodity producers are being sold off to raise capital. In essence there is a Fire Sale going on in the U.S.

 

So, I don't believe we are headed in the right direction what so ever.

[Acantha]

There is a philosophy for the devaluation of the dollar where the theory behind is it through devaluation of our currency it does make our goods and services produced here in the U.S cheaper abroad, creating a higher demand for our products and therefore adding to our ability to generate more tax revenues through exports .

Yeah, that's why they're screwing our money. They could care less about the effects it has on our trade. Bernanke has gone on record saying he favors a strong dollar, and no matter how weak our dollar gets, our trade deficit increases every year. They create money because they want to spend, period.

 

This is one of the criticisms that we and the majority of the developed nations have against China. They have artificially kept their currency cheap making their goods in our countries view, unfairly competitive. Now we can't really criticize them as much as we would like to, because they are funding our stimulus and bailout packages through their investments in treasuries. In reality, I don't believe that their currency "manipulation" tactics is their biggest advantage they have over the rest of the developed world when it comes to exporting goods, I believe it to be their input costs, specially on the labor front, along with all the incentives and tax breaks that their government afford to Chinese entrepeneurs in attempt to spur their rapid expansion.

China has pegged their currency to the dollar. So why is that unfair? Why would China sit back and allow the United States to create as much money as they want, so that they are able to buy more Chinese goods with increasingly worthless money while at the same time selling our goods to them for MORE money???? Yep, it's the Chinese who are guilty of "manipulation".

[Magox]

Yeah, that's why they're screwing our money. They could care less about the effects it has on our trade. Bernanke has gone on record saying he favors a strong dollar, and no matter how weak our dollar gets, our trade deficit increases every year. They create money because they want to spend, period.

 

 

China has pegged their currency to the dollar. So why is that unfair? Why would China sit back and allow the United States to create as much money as they want, so that they are able to buy more Chinese goods with increasingly worthless money while at the same time selling our goods to them for MORE money???? Yep, it's the Chinese who are guilty of "manipulation".

I'm totally with you on that. Everyone who is accepting dollars is basically importing inflation. I don't believe we have a leg to stand on in attempting to criticize them for being "currency manipulators". Of course, the tone has changed a lot now that we depend on them to pay for our bailouts and stimulus .

 

I don't know if you heard or not, but they are calling on a new super reserve currency or SDR's issued by the IMF. Obviously a lot of that is political posturing, but none the less, it is a concern of theirs, and rightfully so. The treasury market in my view is one of the biggest bubbles out there right now.

 

The Chinese have also made deals with 6 different countries since December of 08, to where they will be creating a currency swap line with those countries so that they can bypass the dollar and use the yuan instead. This is one of the moves that they are using to lessen reliance on dollars, in essence helping diminish the role of the dollar and boosting the yuan.

 

http://english.sina.com/business/2009/0419/234994.html

 

 

China caused a stir in March when central bank chief Zhou floated the idea of reducing reliance on the U.S. dollar as the world's primary unit of foreign exchange by developing the Special Drawing Rights (SDRs) issued by the IMF.

 

But at the London G20 forum, China did not call for immediate discussion of the subject.

 

Speaking at the Boao forum on Saturday, Zhou said that his proposal on SDRs was intended mainly to contribute his thoughts on the root cause of the financial crisis and what needed to be done in the long run to prevent such situations in the future.

 

He was not suggesting that drastic changes to the financial system needed to be taken in the short term, Zhou said.

 

"It's just like treating a patient. First we need to make a diagnosis. Then comes treatment," Zhou told the forum.

 

"But right now, not all the doctors have the same diagnosis.... Unfortunately, it seems that there is still no consensus among various countries about the source of the financial crisis," he said.

Premier Wen said China would look at expanding its currency swap agreements that are seen as a step toward eventually making the yuan more of a global reserve asset.

 

"We should give full play to bilateral currency swap agreements and will study expanding currency swaps in scale and to more countries," he said.

 

China's central bank has signed six swap deals since mid-December, totaling 650 billion yuan ($95 billion), with countries from Argentina to Indonesia.

 

The yuan's international potential is sharply constrained by its limited convertibility, an issue that Wen did not broach.

[Acantha]

I'm totally with you on that. Everyone who is accepting dollars is basically importing inflation. I don't know if you heard or not, but they are calling on a new super reserve currency or SDR's issued by the IMF. Obviously a lot of that is political posturing, but none the less, it is a concern of theirs, and rightfully so. The treasury market in my view is one of the biggest bubbles out there right now.

I hadn't heard about any specific plans, but there's no doubt there will be a strong push for a world currency soon enough. When it happens, the US will have no choice but to go along, and that will be the end of our place atop the world, in addition to the beginning of the end of a lot of our liberties.

 

The Chinese have also made deals with 6 different countries since December of 08, to where they will be creating a currency swap line with those countries so that they can bypass the dollar and use the yuan instead. This is one of the moves that they are using to lessen reliance on dollars, in essence helping diminish the role of the dollar and boosting the yuan.

And rightfully so. As much as it sucks for us, it's time for the Chinese to get out from under us. We're a big reason they have been able to expand they way the did, but at this point we're holding them back far more than we're helping. No matter how they go about it, it's going to be a rough transition, but after some growing pains they will be in position to take over as the economic center of the world.

[Magox]

Yeah, that's why they're screwing our money. They could care less about the effects it has on our trade. Bernanke has gone on record saying he favors a strong dollar, and no matter how weak our dollar gets, our trade deficit increases every year. They create money because they want to spend, period.

What you just wrote reminded me of the Bernanke Doctrine of 2002, about fighting deflation. Here is one of the things he said:

 

"The U.S. government has a technology, called a printing press, that allows it to produce as many dollars as it wishes at essentially no cost." "Under a paper-money system, a determined government can always generate higher spending and, hence, positive inflation."