China Shifts to Euros for Iranian Oil

Originally posted by Gools
Seems like things are moving again in the petrodollar world including moving ahead with a Euro based oil bourse: Petrodollar Warfare: Dollars, Euros and the Upcoming Iranian Oil Bourse

This particular story came out a couple of days ago and is reporting a continuing development that began a few months ago.

I think it kind of puts this story from a couple of days ago into perspective: United States Sanctions China! Just in!

That makes more sense now.

Funny how these important economic and geopolitical developments are playing-out totally under the radar in the mainstream media.

Makes me thinks it's important or something.

.

business.scotsman.com
(visit the link for the full news article)

[edit on 3/31/2007 by Gools]

________________________________

Gools: "United States Sanctions China!"

This action will prove to be a very big deal in time if not already, by China.

Implications of duty and taxes must scare the shxt out of China's industrial bosses and above. As with Canada, I could not understand how they (China) managed to export their many textile and electronic goods here and in the USA without paying considerable tariffs.

Dunno what the Euro switch-over may have had to do with the US implementation of tariff of goods in from China exactly..but was privy to Iraq's intention in /01 to do the same.

Canadian and American industry will benefit with imposed tariffs against the import of Chinese Made goods.

Of course the percentage of duty implied will be ket I feel.

Dallas


[edit on 2-4-2007 by Dallas]

First we Dis China...then we Dis China?

US and S Korea in landmark trade deal
By Anna Fifield in Seoul and Eoin Callan in Washington

Published: April 2 2007 05:30 | Last updated: April 2 2007 11:25

Washington and Seoul agreed a landmark deal on Monday that will dramatically liberalise trade between the countries, giving the US an economic foothold in north-east Asia and helping South Korea upgrade its economy.

Full text: /2bkzgh

BAD FOR THE DOLLAR AND PROBABLY GOOD FOR GOLD

U.S. protectionism could also set off a very unpleasant chain of events, sending the U.S. dollar much lower, and gold much higher.

I am utterly sincere when I say the world is generally unaware how much of the recent prosperity it has enjoyed is the result of the wise free trade agreements, which have gradually been implemented in many parts of the world over the last decades. I am not kidding when I state that, should we reverse these free trade policies in a big way, it would be devastating to world and U.S. economic growth, and to the world and U.S. standard of living.

Full text: /2gp57t


Perhaps we could have waited until the ink was dry on the Chinese paper products sanctions...before embracing a free trade agreement with South Korea.

The immediate consequence of the sanctions will be higher prices for the American consumer on Chinese imports...but I fear other reprisals are in store.

I'm reading that the Korean agreement will encounter stiff resistance from 'cattle state' senators, and has little chance of passing unless Korea agrees to lift their ban on US beef.

Peace &
Good Fortune
OBE1

Think your pretty-much right on OBE1. My thought is, it will hurt in the beginning but open up NAFTA Countries in the manufacturing sectors providing the duties are high enough against Chinese imports.

Dallas

With all of this in mind, how do you see a hypothetical trade war playing out? Try to be detailed with your descriptions. Use your imagination and show us your smarts.

Originally posted by Dallas

That makes more sense now.

Funny how these important economic and geopolitical developments are playing-out totally under the radar in the mainstream media.

Makes me thinks it's important or something.

.

This all scares me more then it scares them. Have you looked at whatever products you buy lately, including the PC you are using? The majority of stuff is marked "Made In China", so who will it hurt in the long run? Them or Us? I think the latter, since the tarriffs will just be added into the price at the register.

Hi Dallas

Some of the talking heads out there, (including the Chinese), read the sanction thingy as an 08 political move by the Bush admin to get out in front on the trade issue. The Dems have been quite vocal about their intention to go after Beijing in this regard...particularly harping on the Yuan valuation. To quote one Chinese economist today; "Next year, it will be the presidential election, the government is under pressure from the trade unions and wants to win the support of the blue collar workers."

Needless to say, the Chinese haven't taken kindly to this move, and see it as a violation of the WTO agreement.

As I'm sure you know, our lifestyle, to a large degree, remains dependent China's willingness to cover our government debt...$800 billion in 2006 alone. This is where my concerns begin.

I follow a pundit that watches foreign participation in the monthly US Bond auctions...two days prior to the sanctions announcement, sales fell off sharply: /2bxtmk

The Dollar, already under pressure, didn't like this move. Imagine the affect of interest rate hikes to fend off a Dollar crash...on an already flagging housing market....TIMBER!

Also, today's financial data showed manufacturing down, and prices up...the 'stagflation' scenario predicted for a few years now by those in the Gold community, and others...a slowing economy in the face of rising inflation.

How would you like to be a Fed governor about now? Somebody recently described Bernanke & Paulson as "two cheeks of the same arse"...

Maybe I just need to get out more often.


Peace &
Good Fortune
OBE1

Originally posted by Justin Oldham
With all of this in mind, how do you see a hypothetical trade war playing out? Try to be detailed with your descriptions. Use your imagination and show us your smarts.

"They built a house of straw. The thundering machines sputtered and stopped. Their leaders talked and talked and talked. But nothing could stem the avalanche.

Their world crumbled. The cities exploded. A whirlwind of looting, a firestorm of fear. Men began to feed on men. On the roads it was a white line nightmare. Only those mobile enough to scavenge, brutal enough to pillage would survive. The gangs took over the highways, ready to wage war for a tank of juice.

And in this maelstrom of decay, ordinary men were battered and smashed. Except for one man armed with an AK-47, and a Honda full of silver." - source unknown


I'm with him...but like I said, I probably just need to get out more often.


Peace &
Good Fortune
OBE1

Originally posted by Justin Oldham
With all of this in mind, how do you see a hypothetical trade war playing out? Try to be detailed with your descriptions. Use your imagination and show us your smarts.

__________________

For my thought, the opposite as how it was before China's serious influx. How 'bout you and be detailed too.

Dallas

Hey there ThePieMaN. Assuming the US of A admin stays in the battle of fair-trade and not trying to use this recent stand against 0 duty with China. Well it will work out and American Industry will begin to grow. ie BEGIN.

It will take some time. Frankly I feel the Euro Dollar and China's new found foreign currency has sent a scare into the present

Admin/NWO/Bilderberg peoples, and what a savage but overdue attack -- back. Duty -- but it has to be high enough to stimulate American business to invest in re-employing manufacturing.

Dallas

OBE1
"Hi Dallas"...

Can't speak to your thoughts on this. Don't have that in depth and intensified knowledge on world economy.

But I'm sure. No matter what. China will be brought down to it's knees (mahaps below?) should the USA impose serious duty tariffs. I'm very sure of that. Hopefully?, Canada will do the same ASAP.

China's been seemingly quiet..while there buying Lexus, gold Oil and hydro at basement prices. Perhap's their mistake was deciding to do bus in euro dollars was their end run into insanity, since their unhelp, help, unhelp with the NK issue?

Dallas

Originally posted by Dallas

Can't speak to your thoughts on this. Don't have that in depth and intensified knowledge on world economy.

Me either Dallas...just take it where I can find it, and have a tendency to horrible-ize...you should see the stuff I read.

Maybe the worst case with this thing, would the sparking of global tariff wars that would have us all looking for a job...probably not gonna happen.


Peace &
Good Fortune
OBE1

obe 1 .. I didn't post a link to youtube???

I was involved in import export business with China in the 1990's. When calculating import tarrifs on goods, we had to find which goods were exempt from or had a low tarrif. If the tax was too big of a percentage, there wouldn't be enough proffit to make the import worthwhile.

The taxes imposed on Chinese goods were said to be reduced from what other countries import rates were assigned at. I was told it was like that in order to encourage foreign trade and to assist China with economic developement. We also needed signed documents that stated the goods were not made by children....we considered this to be a joke, because there were children employed in most Chinese factories at the time.

I can still get you any official doccument you would like!

So....we reduced the tarrifs on Chinese goods to encourage imports from China, thus helping their economy.

Now that they have their own economy strengthening, have we put the import tarrifs at a par with what imports from other Countries have to pay??? Or, are Chinese imports paying a higher rate than from other countries???

They should be the same for all imports, not lesser for some, which would be a more fair way of doing things. That just made importers of Chinese goods, very wealthy.

Originally posted by win 52 So....we reduced the tarrifs on Chinese goods to encourage imports from China, thus helping their economy.

win52...you worked in China...interesting. Wondering which years?

Anyway, here's a summary of China's WTO concessions dated 1999: h/33yqwj

The US wasn't required to make any new concessions to China...other than to accord them the same treatment it accords all other members of the WTO. China was granted membership at the end of 2002, contingent on annual review by congress.

The issue at hand with regard to the proposed sanctions, seems to revolve around Chinese subsidies to their paper manufacturers. By comparison, the US grants 4 billion in annual subsidies to it's cotton growers, making America the worlds largest exporter...without subsidies, the US cotton industry wouldn't be able to compete.

Aside from possible tariff retaliation, the Chinese hold 1 trillion in US currency reserves (Treasury Securities)...that's a lot of ammo. Also, the world central bank foreign-exchange reserves (US Dollars) just reached an 8yr low...and the Euro has gained 35% against the US Buck in the past 5yrs. The Dollar looks vulnerable here.

Now that they have their own economy strengthening, have we put the import tariffs at a par with what imports from other Countries have to pay??? Or, are Chinese imports paying a higher rate than from other countries???

Not sure how all other trade agreements are structured...at the time China entered the WTO, there were 146 members.

A report issued by the Trade Office on Monday, wasn't limited to China, but cited 62 other countries as being in violation of fair trade practices as well: /yob538

I guess the concern from some non-government economists, is that a movement towards protectionism could build steam as lobbyists from other major US industries begin pushing the lawmakers.

It all gets a bit complicated, but from my perspective...the story seems to have some political undertones.

obe 1 .. I didn't post a link to youtube???

Sorry win 52...I didn't understand this reference?


Peace &
Good Fortune
OBE1


[edit on 3-4-2007 by OBE1]

Here's a question. How many more 'deals' like this are we going to see in this calendar year? Anyone care to speculate?

.Source

Speaking of deals, what says you to this? Bear in mind that our politicians will somehow manage to put money in their own pockets as a result of this deal.

Originally posted by Justin Oldham

Bear in mind that our politicians will somehow manage to put money in their own pockets as a result of this deal.

That ain't workin

that's the way you do it
Get your money for nothin get your votes for free.


One way to siphon off surplus US Dollars...aside from selling them back into the open market, and causing a currency panic that benefits no-one, is to establish a State Investment Fund...then use that fund in the pursuit of resources, and the purchase off-shore corporate assets...enter the Dragon: /yuf6qm

A lot of basic distrust around China's lack of transparency. Corporate corruption, sketchy trade practices, and failure to swiftly implement reforms have been stumbling blocks with regard to their more substantial take-over bids i.e...Unocal & Maytag. Add to that...access to seemingly endless money is also perceived as a threat.

As I'm coming to understand, brand recognition, or brand value, is extremely important to emerging economies. In the game of buy-out as a strategy for achieving this goal, India is presently looking much stronger than China. After facing stiff competition from Russia and Brazil, India's recent buy-out of Corus Steel, is a testament to the reality that the world's major corporate players are still more comfortable dealing with countries like India, and the other 'BRIC' nations, than with China. By comparison, Beijing's successes include Lenovo's bid for IBM's personal-computer business, and Nanjing Auto's purchase of the UK's bankrupt Rover Group.

Maybe I'm just suspicious by nature Justin, but a few of the ME countries mentioned in your link, have recently signaled their concerns over bulging US Dollar reserves...makes one wonder? If you see the Dollar in decline, and you've got lots of them...why not acquire productive global assets...before all those dead presidents are worth-less?


Peace &
Good Fortune
OBE1

A little more on your lead JO.

Dow Chemical employees, and Michigan residents began expressing their concerns back in February: /36t69v

Since the buyout rumours first sprouted in Feb, DC shares have seen a 13% increase...only to be tempered a bit in after-hours trading yesterday when a Dow spokesperson played-down the allegations: /23wyrj

KKR, infamous for it's exploits back in the 80's, was the subject of the book..."Barbarians at the Gate"...about the takeover of RJR Nabisco, at that time, the largest buyout in history...the "Barbarians" in the title refers to KKR.

These guys have a history...if I lived in Michigan, I'd be worried too.


Peace &
Good Fortune
OBE1

I can't help but notice that this story has dropped off the radar. As a citizen, I'm concerned that our national interest is not served by allowing so much of our infrastructure to be foriegn owned. It's worth noting that those companies that are foriegn owned tend to go out of their way to move money and assets out of the U.S. At the very least, moving their leaders and records out of the country (like Haliburton) sends a bad message to the rest of us.

Originally posted by Justin Oldham
With all of this in mind, how do you see a hypothetical trade war playing out? Try to be detailed with your descriptions. Use your imagination and show us your smarts.

I see it being lost by the USA.

China does not need the American market as much as you might think. The middle class in China is currently estimated in the neighbourhood of 350,000,000 - and growing at a sustained 1% per year. India - who has a very good economic relationship with China - has a middle class in the 250,000,000 range. Those two markets alone are roughly double the population of the USA. And they are both growing. And we have not talked about the upper class yet. Or South Korea, or Japan, or Thailand, or Pakistan, or Iran, ...you get the picture. The SCO nations - members and observers - could easily offset any market losses China sustains in a trade war with the USA - and in short order. And I can`t think of anything offhand that the Chinese get from America that can`t be acquired elsewhere.


Hard for me to see how the USA could win such a fght.

Originally posted by Justin Oldham
I can't help but notice that this story has dropped off the radar

It hasn't dropped off the radar, its been removed.

China has made numerous new trade deals with Russia, India and the EU. Did you hear that reported in America? I would be suprised if you did

Plus, did you hear this?

Most Americans Fear Recession in the Next 12 Months, Poll Finds

Bloomberg