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Thread: Russia rejects US warnings over oil deal with Iran

  1. #21
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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by Sherman123 View Post
    Thanks for reiterating that, I ran that by him but it didn't seem to land.
    It didn't land because it never flew in the first place. What you would have us believe is that the dollar is popular and that is not the case. And the things I posted demonstrated that

    Beijing has made no secret of its desire to diversify from greenback assets -- mainly U.S. Treasuries -- and for the establishment of another reserve currency to use as a store of wealth and for international transactions. The European sovereign debt crisis has reduced the allure of the euro for those purposes. While Beijing has voiced limited support for the various schemes to ease Europe's woes, it has added to its holdings of other, smaller currencies, such as the Australian dollar.
    And from late last year

    What may also be included as a key part of an effective reform is the introduction of a new international reserve currency that is to be created to replace the dominant U.S. dollar, so that the international community could permanently stay away from the spillover of the intensifying domestic political turmoil in the United States.
    That's not the kind of stuff you do when something is popular. It's just like a guy that doesn't like his job but can't find a better one. He goes to it because he doesn't have a better option, not because of popularity.

    Furthermore, if you look at US Treasuries one must consider that backing them is a government that has $127,000,000,000,000.00 IN UNFUNDED LIABILITIES!

    You call that popular???

    You Think The Deficit Is Bad? Federal Unfunded Liabilities Exceed $127 Trillion - Forbes

    You Think The Deficit Is Bad? Federal Unfunded Liabilities Exceed $127 Trillion

    Although the battle over a two-year budget deal and the national debt limit in Washington, D.C. has received the lion’s share of media attention recently , the bigger, more ominous threat facing taxpayers are unfunded liabilities—the difference between the net present value of expected future government spending and the net present value of projected future tax revenue, particularly those associated with Social Security and Medicare.

    While federal unfunded liabilities are important, state-level unfunded pension liabilities also pose serious obstacles. In Texas, the recent 2013 Employees Retirement System (ERS) Valuation Report outlines the funding shortages this pension system faces and there is some indication it may be unable to pay beneficiaries by 2052.

    The federal unfunded liabilities are catastrophic for future taxpayers and economic growth. At usdebtclock.org, federal unfunded liabilities are estimated at near $127 trillion, which is roughly $1.1 million per taxpayer and nearly double 2012’s total world output.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by MildSteel View Post
    Is should be noted that if you look at your chart that there was a drop from 1316.7 in November 2013 to 1270.0 in December 2013. That is a substantial drop. The increase that is shown in January 2014 is to 1273.5, which is still far below the 1316.7 in November. THE INCREASE FROM DECEMBER TO JANUARY WAS 1334 PERCENT LESS THAN THE DECREASE FROM NOVEMBER TO DECEMBER!
    The trendline for the last 30 months and longer remains positive. Fluctuations on a month-to-month basis are commonplace, but the upward trend continues.

  3. #23
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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by donsutherland1 View Post
    The trendline for the last 30 months and longer remains positive. Fluctuations on a month-to-month basis are commonplace, but the upward trend continues.
    This isn't something he has a very solid grasp of. If you want to tag in and make the attempt best of luck.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by donsutherland1 View Post
    The trendline for the last 30 months and longer remains positive. Fluctuations on a month-to-month basis are commonplace, but the upward trend continues.
    It's interesting that you should bring this up. If you go back three years to 2011 in the month of July, something very interesting occurs. Basically there is a peak of 1314.9. This is of interest because from the year 2000, up to July 2011 there is a very substantial increase in China's holdings of US treasuries. After that there is a basic plateau and in fact when their holdings again come to that level in November 2013, there is a sell off the next month. So if you look over the last three years basically the are letting the level plateau out. So basically, they are not interested in increasing there holdings. They just want them to level out. This is consistent with the following statement:

    PBOC Says No Longer in China

    PBOC Says No Longer in China’s Interest to Increase Reserves

    The People’s Bank of China said the country does not benefit any more from increases in its foreign-currency holdings, adding to signs policy makers will rein in dollar purchases that limit the yuan’s appreciation.

    “It’s no longer in China’s favor to accumulate foreign-exchange reserves,” Yi Gang, a deputy governor at the central bank, said in a speech organized by China Economists 50 Forum at Tsinghua University yesterday. The monetary authority will “basically” end normal intervention in the currency market and broaden the yuan’s daily trading range, Governor Zhou Xiaochuan wrote in an article in a guidebook explaining reforms outlined last week following a Communist Party meeting. Neither Yi nor Zhou gave a timeframe for any changes.
    Last edited by MildSteel; 04-11-14 at 10:55 PM.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by Sherman123 View Post
    This isn't something he has a very solid grasp of. If you want to tag in and make the attempt best of luck.
    And you know the Kagan's? I would have expected better.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by MildSteel View Post
    It's interesting that you should bring this up. If you go back three years to 2011 in the month of July, something very interesting occurs. Basically there is a peak of 1314.9. This is of interest because from the year 2000, up to July 2011 there is a very substantial increase in China's holdings of US treasuries. After that there is a basic plateau and in fact when their holdings again come to that level in November 2013, there is a sell off the next month. So if you look over the last three years basically the are letting the level plateau out. So basically, they are not interested in increasing there holdings. They just want them to level out. This is consistent with the following statement:

    PBOC Says No Longer in China
    I don't disagree that the rate of Treasury accumulation has slowed, in line with China's goal of achieving greater diversification and in line with its macroeconomic situation. But that's quite different from the two-year-old piece that pounced on one of the typical fluctuations one sees during annual periods to declare, "But more recent Treasury data show China has been selling Treasuries outright." What happened then was a temporary drop in a trend that still shows net increases in China's holding of Treasury securities. When the trend line turns down and that inversely-sloped line persists for some time, then one can reach the conclusion that China has become a net seller of Treasuries. That isn't the case now. The Barron's piece was reached an erroneous conclusion by failing to include a representative sample of China's Treasury transactions.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by donsutherland1 View Post
    I don't disagree that the rate of Treasury accumulation has slowed, in line with China's goal of achieving greater diversification and in line with its macroeconomic situation. But that's quite different from the two-year-old piece that pounced on one of the typical fluctuations one sees during annual periods to declare, "But more recent Treasury data show China has been selling Treasuries outright." What happened then was a temporary drop in a trend that still shows net increases in China's holding of Treasury securities. When the trend line turns down and that inversely-sloped line persists for some time, then one can reach the conclusion that China has become a net seller of Treasuries. That isn't the case now. The Barron's piece was reached an erroneous conclusion by failing to include a representative sample of China's Treasury transactions.
    No it's not erroneous because as noted they did sell the Treasures as opposed to accumulating more to their stash. And quite frankly your earlier statement about trend lines over a three year period relies on voodoo science to draw it's conclusion of a upward trend. Drawing trend lines is not an exact science and an equally legitimate line can be drawn that shows that the trend is flat and not increasing. You need to look deeper the understand why China is keeping it's level of treasuries constant rather than increasing them. The reason is that they realize that those treasuries carry a substantial risk

    Most recently, the cyclical stagnation in Washington for a viable bipartisan solution over a federal budget and an approval for raising debt ceiling has again left many nations' tremendous dollar assets in jeopardy and the international community highly agonized.

    Such alarming days when the destinies of others are in the hands of a hypocritical nation have to be terminated, and a new world order should be put in place, according to which all nations, big or small, poor or rich, can have their key interests respected and protected on an equal footing.
    The people in China are not foolish

    China is calling for a global currency to replace the dominant dollar, showing a growing assertiveness on revamping the world economy ahead of next week's London summit on the financial crisis.

    The surprise proposal by Beijing's central bank governor reflects unease about its vast holdings of U.S. government bonds and adds to Chinese pressure to overhaul a global financial system dominated by the dollar and Western governments. Both the United States and the European Union brushed off the idea.

    The world economic crisis shows the "inherent vulnerabilities and systemic risks in the existing international monetary system," Gov. Zhou Xiaochuan said in an essay released Monday by the bank. He recommended creating a currency made up of a basket of global currencies and controlled by the International Monetary Fund and said it would help "to achieve the objective of safeguarding global economic and financial stability."
    China was doing the very same thing at the time of the article that you abhor, as they are doing now. They let their holdings get to a level, then they sell them off. It's just like someone who has a container of water that they fill to maximum level, then they let some out and fill it again. That's not increasing their supply of water, that's maintaining a constant level.

    Furthermore, as I have pointed out before, the Chinese realize that those treasuries are backed by a government that has the enormous sum of over one hundred twenty seven trillion dollars in unfunded liabilities. Therefore, US treasuries are not popular to the Chinese as the other poster whom you are defending as put forward. Rather they are a nuisance that they currently have to live with because the US is able to maintain its trade deficit through the sale of US treasuries. We don't have any thing to trade but our debt. The only way to get the money back over here that we send to China when we buy their goods is to sell them our debt. That's how it works. China is stuck with that situation for now and they are trying to relieve themselves of that burden. Therefore the notion that the Chinese find US treasuries popular is nonsense.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by Deuce View Post
    Oh I'm sure the right-wingers will start proclaiming this is all because Obama "looks weak," as if something cosmetic is really what makes the world turn. Then they'll try to avoid saying they support military intervention because they know that's stupid.
    "Obama looking weak" is something he does pretty darn well by himself. "Weak" as in having an extremely weak position in the debate. "Silly" as in drawing red lines and such.

    Vladimir was raised playing chess, whilst Barry was raised playing checkers.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by American View Post
    No it's because your policies suck, you want to be a world economic power as a welfare state. FORGET IT!
    Guaranteeing endless corporate welfare at taxpayer expense is the life blood of the GOP.

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    Re: Russia rejects US warnings over oil deal with Iran

    Quote Originally Posted by MildSteel View Post
    No it's not erroneous because as noted they did sell the Treasures as opposed to accumulating more to their stash. And quite frankly your earlier statement about trend lines over a three year period relies on voodoo science to draw it's conclusion of a upward trend. Drawing trend lines is not an exact science and an equally legitimate line can be drawn that shows that the trend is flat and not increasing. You need to look deeper the understand why China is keeping it's level of treasuries constant rather than increasing them. The reason is that they realize that those treasuries carry a substantial risk...
    Trend lines are not "voodoo science" and they are not a matter of subjectivity. They are a statistical tool, and assuming a Gaussian distribution, the sample size should be 30 or greater before the distribution takes on the properties of that curve.

    Moreover, China's portfolio diversification and advocacy of reforms does not necessarily preclude its being a net buyer--at least for now--of Treasury securities. For example, China could increase its Treasury securities holdings even as Treasury securities constitute a smaller percentage of its overall foreign holdings. That outcome would be produced if it buys alternatives at a rate that allows for its Treasury holdings to account for a smaller part of its portfolio. In such circumstances, in absolute terms, Treasury holdings increase, but in relative terms they decrease.
    Last edited by donsutherland1; 04-13-14 at 10:25 AM.

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