Blame It On China…

Nothing is ever the fault of the “exceptional” United States.  It’s not our fault that we have to spend trillions containing the evil terrorists in the Middle East while we steal their oil and occupy their countries.

And of course it’s China’s fault that the U.S. stock market is all of a sudden finding the gravitational pull of economic, financial and political fundamentals.


China must be the reason that the U.S. stock market has been bought up the highest p/e ratio in history.  Note:  I’m using a p/e ratio based on the way earnings were calculated using GAAP 20 years ago – not today’s garbage GAAP which enables companies to manipulate their accounting to an extreme degree.

I guess it’s China’s fault that almost every public and private pension fund in the U.S. is extraordinarily underfunded.

It’s probably even China’s fault that U.S investors and pensions gobbled up shale oil industry junk bonds like they were going out of style on the assumption that oil would stay above $100/barrel forever.

It’s China’s fault that student debt and auto loans have hit an all-time high in this country.  When housing prices crash again that will be China’s fault too.

I guess when it comes right down to it, it’s China’s fault that Hilary Clinton is being hounded by problems with her use of her personal email to sell U.S. foreign policy decisions to the highest bidder while she was Secretary of State.  Hell, I guess it was China who took a paper towel and wiped clean the hard drive on her personal server.

The fact of the matter is that there was indeed a series of big asset bubbles that formed in China.  But they are no different or more severe than the same asset bubbles that have formed all over the world, including and especially in the United States.  But at least China is trying to address its bubbles.  It was the first to throw its cards on the table and try to let some air out its asset bubbles.  Meanwhile the U.S. continues to defend and inflate its bubbles.

I mean, c’mon on – triple C-rated junk bonds in this country were trading at 4% at one point.  A triple C rating means that the company which issued that debt has a very high probability of going bust.  Triple C-rated paper in the 1990’s traded at yields in the high teens or higher.  More than likely CCC- rated bonds become the new equity of a company when it files for bankruptcy reorganization.  Or it becomes worth pennies on the dollar if the company liquidates.   Triple C-rated paper trading at 4% implies an extreme bubble in the junk bond asset class.  But that’s China’s fault, I guess.

UntitledThis will not end well for the United States.   The problem with forcing the “blame China” propaganda on the U.S. public is that it inevitably will lead to a scenario in which the U.S.Government’s neocons who run the Department of Defense will justify starting a war with China.  A war with Russia is being started in Syria as I write this.  But that’s China’s fault too…

16 thoughts on “Blame It On China…

  1. Blaming all of your problems on someone else means that you are not willing to face up to your own shortcomings. Like Mr. Sousa said, ‘Well done Dave.’

  2. I agree our economy’s huge issues have little to do with China. But your BS about occupying Middle East countries and stealing their oil is pure crap. Whose oil did we steal?…Iraq…US companies got none of it…Libya…it’s a basket case, no one wants to go into…Your posts move from coherent economic analysis and then jump off into the fever swamps of conspiracy theorists. I would stick to the analysis and stay away from the silly nonsense. Just my opinion.

    1. LOL. Ok – agree to disagree but you are wrong. The U.S. rapes and pillages every country it occupies. Just like the Brits and French before it and just like the Spaniards before that and so and so on all the way back to the beginning of civilization.

      The U.S. citizens don’t steal the oil. It’s the military and the big oil companies.

    2. Don – you’re correct – we didn’t invade Iraq to steal their oil, nor did we invade Iraq because of WMD’s, we invaded Iraq to stop Saddam Hussein from undermining the petrodollar cartel by selling Iraqi oil in Euros vs USD.

      10 days after US tanks rolled into Baghdad Iraqi oil spigots were turned back on and all trade was once again settled in US dollars.

      Same fate met Gaddafi when he threatened to sell Libyan oil in a gold backed African Dinar.

      Now Putin is in the US State Dept crosshairs for threatening the US Petrodollar, hence the US lead coup d’etat in Ukraine and the new cold war with Russia.

      The US is not interested in stealing Iraqi oil, Libyan oil, Russian oil, or anyones else’s oil … the US’s single interest is in ensuring all oil sold in the world is settled in USD. This is the lynch pin that holds in place the false floor under the dollar which has allowed the US to accumulate historic levels of debt and enjoy limitless paper prosperity without consequence (until now).

      Anyone who threatens the petrodollar threatens the world reserve currency and therefore is a threat to the US economy, thus all threats to the petrodollar are considered an act war against US interests and are dealt with accordingly.

      Once you understand the petrodollar the scales fall from your eyes. Suddenly the Orwellian curtain parts, USGovt lies and propaganda falls away, US foreign policy becomes crystal clear, as does the true reason for all the wars, death and destruction in the last 40-yrs.

      1. Zen, great response and the only thing you didn’t mention was the US oil trade deficit. The US used to import over half its oil, that’s gone down lately with the shale oil ponzi scheme, not sure how much probably to a third now.

        How does the US “pay” for that oil deficit? Ultimately via the reserve currency status of the dollar, in other words they can print up as many dollars as they want and the oil producers will accept them as payment. That seems pretty close to “stealing” if you ask me — an electronic printing press that can bring into existence $100’s of billions out of nothing with a key stroke and use it to “pay” for real world things of value. This only works as long as the rest of the world can remain confident that the US will remain the world’s biggest bully. Once US hegemony starts fading everyone will jump ship to the next best thing, whatever that is.

        One could argue that the ME states are willingly accepting the dollars as payment for exporting their oil to the US and therefore the US isn’t “stealing” it, but good luck convincing me that the leaders of those countries were put there through legitimate means and that they truly represent the wishes of their populations, and that they AREN’T personally amassing vast fortunes, denominated in dollars, which they then convert to real things of value like land, PM’s, factories etc.

        As Zen says, when you understand the petrodollar then the whole world and the Orwellian system we are under becomes so blatantly clear. I would take it further and say that when you understand Peak Oil (which the US hit back in 1971, the same year it dropped gold convertibility… that gold convertibility was in conflict with the US’s new trade deficit {the dollar was under attack from countries like France who saw through the BS}, which it needed because it had hit Peak Oil and needed to import oil to continue growing… see how it all makes sense?), then the world and the actions of the US military industrial complex become even clearer. The US is a dying empire, just like all the previous ones that outgrew their resources supporting them, and the same thing is happening now as happens to all empires in decline — the corruption and theft is getting out of control as the normal economic activities that traditionally provided wealth for everyone — the honest and the rats alike — now no longer do and those rats in positions of power need to resort to criminality in order to keep their share of the now-shrinking pie growing.

  3. Just having more oil on the open market means the price is lower.

    Funny how Joe Biteme’s son was on Ashley Madison, and he blamed Ruskies/Ukranians for putting his name on there? LOL. Kids should start saying the Russians/Chinese/ISIS ate their homework.

    1. Of course. Blame everyone else to deflect the guilt. ZH had an article which traced his registration to Georgetown U when he was teaching there in 2014.

  4. After the US defaulted on our bonds convertability to gold for foreign nations in 1971, the reserve status of the dollar was prolonged by the petrodollar/ME oil reliance scheme. Then vast areas of known and provable reserves including many working wells were turned off and/or closed off to public access through environmental protection measures such as granting acreage National Wildlife Refuge staus, National Forest, Wildlife Refuges, National Parks, Wetlands, Preserves etc.and for military bases. The same areas ishelter some large mineral, rare earth and gold deposits.
    It is true that the petrodollar/reserve currency privilige has been abused to obtain cheap goods and maintain or extend “empire”.
    Other “necessary”, patriotic and thus often classified/top secret policies and practices are currency/$ and Treasury overissuance and counterfeiting, chronic trade, current account and balance of payments deficits, domestic and exported (hyper)inflation, Romesque military-industrial-espionage budgets, housing, equity and credit bubbles and the destruction of traditional industries and markets like autos, small appliances, mining, textiles, business and consumer friendly (local) banks, small farms (and clean, sustainable agriculture), local startups, independent media, practical health care, etc.
    Finally, Made in USA (not China) labels apply to our unconstitutional nonseperation of powers between government and industry, and between the executive, legislative and judicial branches of government, our fictional/Hollywood accounting, statistics and checks and balances and the “economic recovery miracle”.
    A real representative government that acts in our best interest needs no Big Brother global military presence which at best is overbearing, predatory, and unsustainable when it, or it’s mercenary and undercover proxy extensions, are not stealing oil, gold or elections, trafficking drugs, guns, porn (and slaves), poaching rare species or organs, or hacking up antiquities and websites.
    When did it become necessary to speak mandarin to promote petrochemicals, GMO’s and weapons trafficking from one end of the globe to another, seed and exploit overpopulated prisons, or expropriate and foul food, air and water in the name of “progress”, “prosperity” or “freedom”?

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