The Royal Bank of Scotland has advised clients to take out protection against the risk of a sovereign default by China as one of its top trade trades for 2011. This is a new twist.
It warns that the Communist Party will have to puncture the credit bubble before inflation reaches levels that threaten social stability. This in turn may open a can of worms.
"Many see Chinas monetary tightening as a pre-emptive tap on the brakes, a warning shot across the proverbial economic bows. We see it as a potentially more malevolent reactive day of reckoning," said Tim Ash, the banks emerging markets chief.
Officially, inflation was 4.4pc in October, and may reach 5pc in November, but it is to hard find anybody in China who believes it is that low. Vegetables have risen 20pc in a month.
#1
...has advised clients to take out protection against the risk...
This is another major element that fueled the current financial mess. If you gamble with financial instruments, you should not be able to take 'protection against risk'. You are just trying to tag someone else with what should be your own concern with your own money. Do you underwrite Las Vegas gamblers? A very very small group of people do, and they take their loses without hammering everyone else. These big boys will expect someone else, ie the peons, to ultimately back their loses. Fortunately for them and unfortunately for everyone else, they have agents at the levers of power who will stick it to the peons to cover their gamble.
#3
I have a sneaking suspicion that a default by China would topple enough of the world's financial system that the "protection" advocated by RBS wouldn't be worth the paper / electrons it was written on.
#4
#3 - A US default would also topple the world's financial system, taking China down with it. Every country has been running on too much borrowed money, and none want to pay off the loans, even if they were able to, which they aren't.
This is an essay about the death of the town of Empire, Nevada that I wrote for my own blog. Yet another one of the great things Harry Reid has helped do for Nevada.
Yesterday the United States Gypsum Corporation (or USG) announced the January 31st 2011 closing of its mine and plant in Empire, Nevada. Residents of the Empire -- the last company town in the west -- will have until June 20th 2011 to leave their homes, at which time the mine, plant, and entire town will be "idled." One hundred employees and their families will have to leave the area to search for work and housing.
Those are the bare facts of the story. The reality is, of course, far less sterile and far more terrible. What is actually going to happen is that my community is going to die -- and, as I predicted in the introduction to An Unforgiving Land, a way of life is going to pass forever from the earth, largely un-mourned save by the few of us that have lived it.
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US Gypsum used in manufacture of drywall. Drywall used in new home construction. New home construction seen in vibrant economy. Vibrant economy now seen in...... China.
#2
There's some good folks out there. Shame to see this happen. A lot of other businesses will probably go by the wayside, too. Burning Man will probably be the only thing going in that part of the county, if that doesn't get taxed and permitted to death, too.
#4
Drywall now comes from China. Unfortunately, it comes with incomplete removal/stabilization of H2S & SO2 gasses, which then come out in your house after construction or renovation, and destroy the metal in your wires, AC, plumbing etc. That's bad, of course, but it does generate repair work for the tradesmen during this home construction bust.
#5
USG currently has a market cap of about $1.5B and has had a long string of quarterly losses. It had a market cap of about $8B back in the late 1980s.
Posted by: Lord Garth ||
12/06/2010 9:03 Comments ||
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#6
#4 Drywall now comes from China.
My nephew's son bought a house down in Florida with China drywall. He and his wife did not know or did others at the time. He as well as others had to move out of their houses for health reasons. These houses are sitting empty. Many people cannot afford to buy another house or rent another and make payments on the house sitting empty with China drywall.
For crying out loud, we could manufacture this stuff here at a better quality and in the end cheaper. The screwing you get ain't worth the screwing you get with these China imports.
With little fanfare, the EU adopted new legislation this week that makes certain forms and expressions of racism and xenophobia criminal offenses and allows individual EU nations to prosecute the citizens of other nations for those offenses. What the new law will criminalize is analytical, factual, or hortatory discussion of Islam and Sharia by non-Muslims.
Their conclusion is bolstered by recent events. Geert Wilders of the Netherlands is only the most famous of several Europeans who have faced criminal charges for speaking critically of Islam. Another is Austrian journalist and activist Elisabeth Sabaditsch-Wolff, whose trial for hate speech opened in Vienna on November 23. Take a moment to read publicized transcripts of the proceedings; it is worth understanding that Sabaditsch-Wolff is being tried, literally, for quoting both the Koran and an authoritative work on Sunni law, and expressing criticism of the social institutions condoned in those religious texts.
#3
Nope, I read the legislation.
That could get interesting.
Posted by: European Conservative ||
12/06/2010 12:27 Comments ||
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#4
The funny thing with this regulation is that you could actually use it to ban the Koran.
It will be interesting indeed to see what Geert Wilder makes of it, European Conservative. Only, how to get at the Koran if quoting the Koran to attack the Koran is banned by the regulation?
The Investigative Project on Terrorism reports that two Islamist groups in the U.S., Revolution Muslim and the Islamic Thinkers Society, are a growing menace.
Desmond Tutu (Noble Prize 84) and Mary Robinson (former Prez of Ireland and UN High Commissioner for Human Rights) wrote to the US Senate (to complement them for passing a resolution calling for an end to child marriage) and to the US House (urging them to do the same.
Tutu and Robinson, who are both apologists for Paleo terror groups, probably think Islam doesn't allow such marriages (several Hadiths say Mohammad married a 6 yr old and consummated it when she was 9 and the Quran says Mohammad is the best of men and a model). They also may figure they have credibility with the 3rd world.
We'll see about that.
Posted by: Lord Garth ||
12/06/2010 09:04 ||
Comments ||
Link ||
[4 views]
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#1
Translation
Human rights meddlers call for others to enable their pet cause, Cause they're RIGHT(Just ask them)
Ignoring whether or not YOU think it's right or wrong they want to be seen(Critical word)as HEROS, but NOT do any work. Spend any money, or otherwise be discomfited.
Posted by: Redneck Jim ||
12/06/2010 10:34 Comments ||
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A multi-volume chronology and reference guide set detailing three years of the Mexican Drug War between 2010 and 2012.
Rantburg.com and borderlandbeat.com correspondent and author Chris Covert presents his first non-fiction work detailing
the drug and gang related violence in Mexico.
Chris gives us Mexican press dispatches of drug and gang war violence
over three years, presented in a multi volume set intended to chronicle the death, violence and mayhem which has
dominated Mexico for six years.
Rantburg was assembled from recycled algorithms in the United States of America. No
trees were destroyed in the production of this weblog. We did hurt some, though. Sorry.
