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China is no punk!


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#11 Mr Dev

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Posted 19 October 2010 - 09:06 PM

Oh ya douglas ...you got it !

...i hadn't seen the whole thread ..before i replied to jjc.

iloli... you are so right

dowdeva...wow that was amazing ...thanks for sharing! i sometimes forget how amazing they made the Olympics look.

selecto .... you said it.

roger... why don't you give em a call and straighten this whole thing out. :)







There's bigger trouble brewing with China. They have apparently quietly moved to cut off shipments of certain rare earth minerals used in tech and defense manufacturing to the U.S. as was recently done to Japan (see article at www.nytimes.com). Not sure if it's in retaliation for green tech trade tango late last week. This is about to get out of hand. This reminds me of the October mess with Baker in 1987 which caused a stock crash.


Edited by Mr Dev, 19 October 2010 - 09:07 PM.


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#12 hpm123

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Posted 19 October 2010 - 09:12 PM

But the interruption in rare earth supplies is the latest sign from Beijing that Chinese leaders are willing to use their growing economic muscle.


How you feeling about that Nike, IBM, HP, Ford, GM?

How we feeling about it?? We got ours kid, and as long as we continue to get ours - we got no problems. How you feeling about it punk kid??

:lol:

EDIT - My Clint Eastwood imitation :)

Edited by hpm123, 19 October 2010 - 09:14 PM.


#13 Rogerdodger

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Posted 19 October 2010 - 09:32 PM

roger... why don't you give em a call and straighten this whole thing out.


I tried.
30 minutes after I called China, a guy came to the door with a "Number 10" with fried rice.

Edited by Rogerdodger, 19 October 2010 - 09:34 PM.


#14 Mr Dev

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Posted 19 October 2010 - 10:32 PM

roger... why don't you give em a call and straighten this whole thing out.


I tried.
30 minutes after I called China, a guy came to the door with a "Number 10" with fried rice.


:lol:

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Mr Dev

......trading is basically a simple operation, but you have to be a genius to understand the simplicity.
.....timing,..... is ....everything !
... remember no guessing visit MrDev!

#15 salsabob

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Posted 19 October 2010 - 11:14 PM

China's economy is now large enough that both of these moves (interest rate change and rare metal exports) can be viewed as being motivated solely in response to their own internal conditions, perhaps moderated to some extent by international considerations. Other than their rare earth minerals, there is nothing that China exports that cannot be duplicated elsewhere. DARPA has long been funding research efforts to replace the rare-earth metals with other materials; it really is a matter of price differentials. Further, prior to China, with its lax environmental and labor safeguards, becoming dominate in rare earth minerals, the US was the primary producer - mines can be reopened and other potential sources are there just not yet exploited. Given China's near complete dependence on imports of two of the three economic essentials (oil and food, but not water), it would be exceedingly stupid of them to attempt to use their current advantage in important, but not essential, rare earth minerals as an indicator of geopolitical strength. That would likely bring into view their complete dependency and staggering vulnerabilities. Sure, China has been buying up both energy and food production around the globe - that is economic colonization which is far easier to oust than the earlier form of European colonization when the locals decide that it would be in their better interest to keep those resources for themselves - either because they actually need them or it has been 'suggested' it would be better to do so by the one player that can escalate that suggestion to something more persuasive - the US. With the US controlling the world's reserve currency, China must compete with earned income against the US printing press - they will lose. And if it should get a little hotter, well, China is in the league of several nations being able to defend its bordersBUT there is only one nation capable of projecting military power that, at a minimum, can control any international shipping lane. But control is not necessary; mere disruption (as far lesser players have proven) can be devastating. A simple 'incident' at the Straits of Hormuz would have far more dire consequences for China than any other nation (although it will also likely end the regime in Iran as well) and far more of an impact that can be generated under the worst scenario of any cutoff of important-but-not-essential rare earth minerals. The US as the world policeman or at least a force for attempted stabilization is one thing (with accompanying complaints and whining); however, the US as a de-stabilizing force, focused on you, is far beyond the worst nightmare of any foreign leader. China may or may not be a punk, but it is certainly not stupid - not likely to repeat the mistake of another Asian county 50 years ago (next December 7) - not stupid enough to wake the sleeping giant. For now, at best, a short-term market mover - soon forgotten.
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#16 SemiBizz

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Posted 19 October 2010 - 11:36 PM

China's economy is now large enough that both of these moves (interest rate change and rare metal exports) can be viewed as being motivated solely in response to their own internal conditions, perhaps moderated to some extent by international considerations.

Other than their rare earth minerals, there is nothing that China exports that cannot be duplicated elsewhere. DARPA has long been funding research efforts to replace the rare-earth metals with other materials; it really is a matter of price differentials. Further, prior to China, with its lax environmental and labor safeguards, becoming dominate in rare earth minerals, the US was the primary producer - mines can be reopened and other potential sources are there just not yet exploited.

Given China's near complete dependence on imports of two of the three economic essentials (oil and food, but not water), it would be exceedingly stupid of them to attempt to use their current advantage in important, but not essential, rare earth minerals as an indicator of geopolitical strength. That would likely bring into view their complete dependency and staggering vulnerabilities.

Sure, China has been buying up both energy and food production around the globe - that is economic colonization which is far easier to oust than the earlier form of European colonization when the locals decide that it would be in their better interest to keep those resources for themselves - either because they actually need them or it has been 'suggested' it would be better to do so by the one player that can escalate that suggestion to something more persuasive - the US.

With the US controlling the world's reserve currency, China must compete with earned income against the US printing press - they will lose.

And if it should get a little hotter, well, China is in the league of several nations being able to defend its bordersBUT there is only one nation capable of projecting military power that, at a minimum, can control any international shipping lane.

But control is not necessary; mere disruption (as far lesser players have proven) can be devastating. A simple 'incident' at the Straits of Hormuz would have far more dire consequences for China than any other nation (although it will also likely end the regime in Iran as well) and far more of an impact that can be generated under the worst scenario of any cutoff of important-but-not-essential rare earth minerals.

The US as the world policeman or at least a force for attempted stabilization is one thing (with accompanying complaints and whining); however, the US as a de-stabilizing force, focused on you, is far beyond the worst nightmare of any foreign leader.

China may or may not be a punk, but it is certainly not stupid - not likely to repeat the mistake of another Asian county 50 years ago (next December 7) - not stupid enough to wake the sleeping giant.

For now, at best, a short-term market mover - soon forgotten.



Unless you wrote this linked article, I'd suggest that you make sure you use quotes and give credit to the author...



The only leverage China really has on the global stage is its stash of rare-earth metals. As for that leverage: you can rest assured that DARPA (Defense Advanced Research Projects Agency) has long been funding research efforts to replace the rare-earth metals with other materials. In the meantime, mines will be reopened or other potential sources explored.



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#17 arbman

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Posted 19 October 2010 - 11:37 PM

China's economy is now large enough that both of these moves (interest rate change and rare metal exports) can be viewed as being motivated solely in response to their own internal conditions, perhaps moderated to some extent by international considerations.


This was kind of my conclusion as well rather than an hostile attempt to hurt US economically. They are trying to control the domestic lending in their country and support at the same time their exports at an optimal level, imho.

BTW, if the current monetary conditions mean a runaway inflation in US is about to happen, it makes more sense to hold on to your especially mineral exports and cool down the domestic economy to make sure an optimal production also takes place...

So I concur, it feels a lot like austerity measures applied to their domestic growth than any hostile economic attack on other countries and also damage their exports in my opinion. Of course, the end result kind of comes to the same conclusion [keeping for themselves and not quite sharing] and probably the reason the media picked it up as the way they picked it up...

#18 Venatici

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Posted 20 October 2010 - 06:32 AM

...

China may or may not be a punk, but it is certainly not stupid - not likely to repeat the mistake of another Asian county 50 years ago (next December 7) - not stupid enough to wake the sleeping giant.

For now, at best, a short-term market mover - soon forgotten.
...


And what might that be? I mean that stupid asian country from 50 years ago?

#19 Tor

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Posted 20 October 2010 - 07:53 AM

boy it seems to me we saw a preview of the typical bully story unfolding today before our very eyes.

the 97 lb weakling who we've been kicking sand at has now had a major terminator transformation or something similar.

you could call it a full two years of working out on P-90X

raising interest rates today better be an eye-opener for the feds!
i really think their days are now numbered for the FED committee as we know it.. china is actually making them look bad at their own game.
talk about a real paridigm change that's taking place under the radar. behind closed doors it can't help but create a question in confidence
from even those working on wall street.

to think that all our flippid remarks and exaggerated predictions of financial armageddon for the US consumer and economy could actually occur in our lifetimes.

is it so hard to imagine riots on wall street when it's this obvious that our financial system needs a good colon cleansing?

how could we manage to handle higher rates up or above 7-8% interest in the US in our condition?
eeek.

:bowtie:



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#20 Rogerdodger

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Posted 20 October 2010 - 10:48 AM

Toyota Prius has to have rare earth for it's batteries.
Windmills have to have rare earth for their magnets.
Rare earth mining as done in CHINA is destroying the environment.

Save the planet my arse. :lol:

Neodymium magnets are critical to windmill turbines, one of the specific areas the Chinese hope to dominate. Each 1-megawatt windmill uses roughly a metric ton of NdFeB magnets.
Rare earth elements are not as rare as their name suggests, however. Before the Chinese began a dedicated effort to mass-produce REE in 1979, there were several major suppliers. Pre-China, the United States was the largest producer. Appreciable amounts of REE were also produced in Australia, Brazil, India, Malaysia and Russia. Any sort of real monopoly on REE, therefore, is not sustainable in the long-run. But before one can understand the future of the REE industry, one must first understand the past.

From Texas Ranger's John Mauldin's Outside The Box
Read more: China and the Future of Rare Earth Elements | STRATFOR

Edited by Rogerdodger, 20 October 2010 - 10:59 AM.