[Info-vax] [OT] USA

[Arne Vajhøj]

On 6/19/2023 1:43 PM, Simon Clubley wrote:
> That's all well and good Rob, but what happens when China grows a bit
> stronger and then decides to show you who the boss is by cutting off
> your imports ?

Americans can no longer get cheap furniture, cheap tools and all
sorts of cheap junk from China.

They will survive.

> Outside of that, what happens when changing world relationships result
> in a decline of the dollar as a reserve currency ?

That would fix the US trade deficit. The dollar would drop and
that would make foreign goods in the US more expensive and
US goods abroad cheaper.

There is probably a reason why China has fought so hard
to keep its currency low to the dollar.

>                                                     That's where the US
> currently gets most of its bullying power from.

It doesn't really give any power.

> In the old days, your military had to worry about protecting your
> industrial base from an enemy. These days, all your enemy needs to
> do is to threaten to stop sending you the goods they now produce
> for you.

If the goods are critical yes.

But China export is mostly consumer stuff.

> Unlike you, China has a strong industrial base, and so is far better
> placed to handle that situation than you are. They don't need to
> produce the best product on the market to survive the destruction of
> the US economy (if they decide to do that), they just need to produce
> a product that is good enough.

China is relative self sufficient. But there are a few things
they need. Including oil.

> Think about that if they decide to destroy the Taiwan fabs. They will
> survive that (even though they will be badly damaged initially), but
> your economy will not.

That is a risk.

But both the US and to some extent Europe are building
semi-conductor fabs to counter that scenario.

Arne