Bring It On

Cutting right to the point, the suggestion that America's creditors would cut off its credit line for having too much debt, defaulting, etc. is foolish. At least, it should be. Our politicians, particularly those of the (D) variety, have shown an unwillingness to use our unmatched "bargaining power" to get us what we want and need. If we continue to fail to assert ourselves, our increasing debt could be a problem (a la Ireland), and default would be a disaster.

But not if I were in charge. If our debt continues to increase, both in size and in proportion to GDP, we will reach a point where other countries will be less willing to buy our bonds. When we reach the day that China says "we won't give you any more money," we will have to make a change. We are dependent on cheap foreign capital, and I don't see that changing. So, to preserve our credit line, we would need to turn the screws on China as soon as they tried to do so to us. You won't buy bonds? Fine. Immediate 50% tariff on all Chinese imports. See how long your economy keeps growing without America's rapacious greed fueling its fires. It won't. China, and the world, would be thrown into chaos.

Yes, my plan is hardball at its hardest, but when it comes down to the wire we will have two choices: give in, or stand our ground. If we give in, we are screwed. If we stand our ground, there could be a substantial period of severe economic distress throughout the world, but I believe that we would eventually be able to re-obtain the upper hand.

Brilliant!

"US TO BAILOUT EU" blares the always understated Matt Drudge.

The linked article (http://www.cnbc.com/id/40454469), surprise surprise, does not discuss an American bailout of the EU. Instead, it discusses how the IMF's role in the EU bailout will probably increase in the coming months. Do conservatives now equate the IMF with the US? I thought the IMF was, second to the UN, the best example of America's willingness to cede its God-given dominion over the world to the inevitable New World Order.

As I finish my introductory paragraph, I realize that my argument is less than fully-formed, and is mostly a knee-jerk reaction to Drudge's constant fearmongering. Too bad for you, dear reader. Fortunately, according to blogger's statistics, you, dear reader, do not exist. Too bad for me. Moving on...

It will be interesting to see what happens to the IMF in the coming years. As the recent crashes of Ireland and Portgual's banks and the impending crashes of Spain and California show, the global economic crisis is far from over. Thus far, the IMF's primary role has been lending to developing nations and working as a quasi-think tank on world economic policies. Lending almost a trillion dollars to the Eurozone bailout is a drastic step in a new direction. It has been suggested that the IMF could become involved with the catastrophes that are NY and CA, which would be unfortunate but interesting. I have no idea where I am going with this. More later.