WASHINGTON—The House of Representatives by a wide margin passed legislation to penalize China’s foreign-exchange practices, sending a powerful warning to Beijing but risking a response that could harm U.S. companies and consumers.
The measure would allow, but not require, the U.S. to levy tariffs on countries that undervalue their currencies, which makes their goods cheaper relative to American products. A majority of Republicans lined up with Democrats to pass the bill on a 348-79 vote, highlighting lawmakers’ long-simmering frustration with Chinese trade practices as well as their sensitivity to the faltering U.S. economic recovery with an election looming.
The vote marks the strongest trade measure aimed at China to make it through a chamber of Congress after more than a decade of threats by lawmakers. But despite the broad support Wednesday, dim Senate prospects make it unlikely the measure would become law this year.
The Obama administration didn’t endorse the measure, nor did it work with House negotiators out of concern for being tagged as secretly approving of the move. Nevertheless, the bill gives the White House another tool to pressure China to boost the value of its currency, the yuan
US got the stimulus – China got the interest payments on that borrowed money
US got promises for a new jobs – China got new jobs cause the companies are opening plants there
US got the bill for all that stimulus money politicians wasted – China got all those payments from the loans they gave us
US got in debt – China got a surplus
……………………………………………..
Remember February 12, 2009?
On that date Obama visited the Caterpillar plant in Peoria, Illinois.
In a speech in front of the plant workers Obama promised that, if the stimulus bill get passed by the senate, then the CAT will rehire back the 22,000 workers, that were laid off the previous month (Jan, 2009)
I remember the speech and the Obama visit because of the controversy after that visit.
After the president left the event, the CEO of CAT Jim Owens was asked, if the stimulus package would be able to stop the 22,000 layoffs or not, Owens said, “I think realistically no. The truth is we’re going to have more layoffs before we start hiring again”
“It is going to take some time before that stimulus bill” means re-hiring, he said.
Owens supports the stimulus plan, but said it would take some time to have an impact on his industry and “is a little light on the heavy construction.”
Now … One year and 8 months later, I think we gave enough time to see the stimulus bill kick in, create jobs, stop layoffs, spur economic growth, whatever the promises were….
Ain’t happening folks…Non of the promised…
So now politicians say we need more stimulus, because the first one didn’t create enough jobs, the layoffs continue, economic growth was very small, and whatever the promises were -mainly, more jobs for the American people did not realize…
Instead we have a news today, that CAT will create jobs not in the USA but in China by building a plant there:
NEW YORK (AFP) – Caterpillar, the world’s largest manufacturer of construction equipment, will build a factory in China to produce mini hydraulic excavators, the company said in a statement.
Construction will begin in Wujiang, near Shanghai, at the end of 2010 and the facility should be ready in 2012 to begin production of mini excavators of less than eight tons, the company said Tuesday.
Caterpillar did not say how much the project will cost.
It is part of a long-term plan for investments in China that will make Caterpillar one of the leading manufacturers of construction equipment in the country.
“China is the world’s largest market for excavators in the below eight ton class, and the development of this new facility will better position Caterpillar to provide our customers in China with solutions that will help them succeed,” said Mary Bell, a Caterpillar vice president.
Caterpillar already has a factory in Xuzhou, which is also near Shanghai.
The company, which is headquartered in Peoria, Illinois, had sales and revenue of 32.4 billion dollars in 2009
I understand that it is good for the business and the share holders to build factory in China, because they are booming, but my question is: WHY THE FUCK WE TOOK ALL THOSE MONEY FROM CHINA TO CREATE JOBS? WHO IS GOING TO PAY THE LOANS BACK (WITH INTEREST) SINCE US PEOPLE ARE OUT OF JOBS, BECAUSE CORPORATION ARE FLEEING THE COUNTRY?
AND I DO NOT REALLY BLAME THEM.
I BLAME THE UNIONS AND THE POLITICIANS IN THIS COUNTRY
UNIONS BECAUSE OF THEIR CRAZY DEMANDS, THAT MAKE DOING BUSINESS DIFFICULT HERE AND THE POLITICIANS BECAUSE, THEY VOTE HIGHER AND HIGHER TAXES ON THE “EVIL” CORPORATIONS, MAKE RULES AND REGULATION THAT MAKES BUSINESS OPERATION A NIGHTMARE AND BECAUSE THEY ALLOWED THE CHINESE SLAVE LABOR, ENVIRONMENTAL DESTRUCTION AND CURRENCY MANIPULATION GO ON FOR A DECADE AND THAT WAY, GOT ALL MANUFACTURING JOBS OUTSOURCED TO CHINA
Just consider what Obamacare is doing to businesses…
Caterpillar Inc. and Deere & Co. will see costs increase this year when a government subsidy for retiree drug benefits loses its tax-exempt status under the new health-care law.
On Thursday, Deere said taxing the subsidy meant to help lower costs for companies that offer retiree drug coverage will result in a one-time charge of $150 million. Earlier, Caterpillar said the same tax will raise its costs by $100 million.
AT&T on Friday said it will record a $1 billion non-cash expense in the first quarter related to the newly passed health-care law, joining a growing list of large U.S. companies.
Is it a surprise to you that businesses are leaving USA?
But the politicians blame instead…
you - because you do not spend enough (on credit)
and
the companies – because they are siting on mountains of cash (because of the uncertainty of the business environment)
*Damn! I would like to share with you few insider stories about CAT, but my friend is still working for them and hold a high position in the hierarchy, so I don’t want to harm him by telling these stories to the public. As soon as he quits, I will post them…LOL… I hope they will not lay off the whole executive board if someone read this post
Lifelines for the poor are disappearing – Washington has spent tens of billions of dollars since the start of 2009 on programs to help feed the poor, house the homeless and support the unemployed. But much of this money has been used up or is about to expire in coming weeks and months. Now what? Print more money? I suggest, if you are one of the poor and out of a job – go to Washington and ask them how in the hell the median household income there is $85 000?…
Thousands of jobless in N.C. told they owe money to the state – Thousands of long-term unemployed North Carolinians could soon owe the state money because the Employment Security Commission improperly made about $28 million in payments over the last two years. Thats how the Big government works – don’t care, wasting millions, no coordination, no accountability…. When the Government start overseeing the healthcare system, I wonder how many people will receive notices that they improperly got medical help and that the government wants the kidneys back.
States Are Poised to Be Next Credit Crisis for US: Whitney - Crippling debts and deficits are about to make individual states the next casualty of the credit crisis, analyst Meredith Whitney told CNBC. DUH! Remember that some people were saying that a problem like the Greece is having cannot happen here? News flash: Already is happening…
Middle-aged suicides on rise in U.S., study finds - Suicide rates for middle-aged people are edging up — particularly for white men without college degrees — and a combination of poor health and a poor economy may be driving it, U.S. researchers said on Monday. When I read the news…. I have thoughts myself….Nagh…Still just kidding… I am optimist in surviving the second crash and world depression…
Recession rips at US marriages, expands income gap- The recession seems to be socking Americans in the heart as well as the wallet: Marriages have hit an all-time low while pleas for food stamps have reached a record high and the gap between rich and poor has grown to its widest ever.
Consumer confidence drops to lowest since Feb – Americans’ view of the economy turned grimmer in September amid escalating job worries, falling to the lowest point since February. The downbeat report, released Tuesday, raises more fears about the tenuous U.S. economic recovery. It also further underscores the disconnect between Wall Street and Main Street; consumers’ confidence fell further even as stocks rebounded in September. And naturally the next story derives from this one….
CEOs less willing to hire, sales a worry - U.S. chief executive officers’ view of the economy darkened in the third quarter, with top executives saying they were less willing to hire new workers as they fear sales growth will slow.
One-third of Americans Score Too Low for a Mortgage - Mortgage lenders have raised standards on credit scores so high that nearly one-third of Americans are unlikely to qualify for a mortgage because their credit scores are too low. The rest just cannot afford the payments for the expensive homes, or have cash to pay in full for it and do not need a mortgage….
Bank of England ‘should consider fresh cash injection – The Bank of England should consider pumping more money into the economy to help the recovery, according to a monetary policy committee (MPC) member. Do not give the junkie the shot! It might not be as good for his health as you think!
Brussels braces for huge anti-austerity protest – Thousands of people from across the EU are expected to march in Brussels to protest against sweeping austerity measures by many national governments. Just wait. This attitude is coming to America. From each according to his ability, to each according to his needs… The communism virus is well alive and spreading around the globe again…Damn! It was just 20 years ago, when we thought it was dead…
Debt forces Harvard back to drawing board -It is no secret that Harvard University ran into a short-term cash crunch when the markets plunged in late 2008 and had to cut costs sharply. But there also has been a longer-term toll: Harvard borrowed heavily to get through that period, and now finds itself grappling with big debt payments and scaling back ambitious plans….Fixing Harvard Endowment Failures Will Take Mendillo Five Years – She has started to restructure the school’s real-estate holdings, which lost 50 percent of their value in the year ended on June 30, 2009. She has been increasing investments in natural resources and timber, an area that she pioneered during an earlier, 15-year stint at Harvard…. LOL the brightest of the bright and look the mess that they are in….Damn.Look the mess we are in because of them! Stupid fu(|<$. The only advantage to graduate at Harvard is that you will be friends with people whose parents are on key position and that they could get you a job no matter how dumb you are. Didn’t see it coming -even their school is tanking now…
USA: Smithers raises alarm over US firms’ high debt levels – Official data shows debt on corporate balance sheets is at the top of its historical range, he says. Debt off balance sheet is more difficult to calculate, but has ballooned over the last decade. Our company is fine …thank God for the screwed up accounting rues that no one understands...
U.S. business fears “downward spiral” in China trade – Congressional passage of a bill to pressure Beijing to revalue its currency could further harm U.S.-Chinese trade relations already hampered by mutual mistrust and suspicion, U.S. companies invested in China said on Monday. Really? If I don’t have a job I do not have the money to buy your products… you morons…
Roubini Sees High Risk of a U.S. Recession, Says Japan `Anemic’ – There’s a high probability of another recession in the U.S., with Japan’s outlook “anemic,” underscoring risks to the global recovery also China, the world’s fastest-growing major economy, may face greater headwinds should there be weak growth in the U.S. and Europe…
Markets could correct in October-November: Marc Faber – You are known as Mr Contrarian in India. You always like to advise the reverse of what the global consensus is. The current global consensus is ‘buy emerging markets and sell US bonds’.
ATA Truck Tonnage Index Plunged 2.7 Percent in August – ATA Chief Economist Bob Costello said that August’s data highlights that the economy, while still growing, is slowing. “We fully anticipate sluggish economic growth for the remainder of this year and the latest tonnage numbers are reflecting that slowdown.” However, Costello believes that the trucking environment has changed dramatically. “While I’d much rather see better tonnage figures, motor carriers can now do better with small increases in demand since so much supply left the industry during the recession.”
Politics Versus Gold - Inflation is a quiet but effective way for the government to transfer resources from the people to itself, without raising taxes. A hundred dollar bill would buy less in 1998 than a $20 bill would buy in the 1960s. This means that anyone who kept his money in a safe over those years would have lost 80 percent of its value, because no safe can keep your money safe from politicians who control the printing presses. That is why some people buy gold when they lose confidence in the government’s managing of its money. Usually that is when inflation is either under way or looming on the horizon. When many people start transferring their wealth from dollars into gold, that restricts the ability of politicians to steal from them through inflation.
Obama: Yes to 2011 climate bill push – President Barack Obama is pledging to throw his full weight next year behind efforts to overhaul the nation’s energy and climate change policies, though he concedes such moves might need to happen “in chunks.” Hopefully there won’t be any democrats left in DC to vote for it after, this November elections.
Taxing the Rich – “Look, the rich people are going to leave. And other people are going to leave. You’re going to end up with lots of people that don’t produce. And then that’s the spiral. That’s the end.”
The U.S. dollar is “one step nearer” to a crisis as debt levels in the world’s largest economy increase, said Yu Yongding, a former adviser to China’s central bank.
Any appreciation of the dollar is “really temporary” and a devaluation of the currency is inevitable as U.S. debt rises, Yu said in a speech in Singapore today.
There is an assumption that losses on infrastructure projects somehow do not matter because of course the government can simply step in to cover them.
But governments do not cover losses. They channel money from households to cover losses. In other words if the Chinese railroad system turns out to be economically non-viable (i.e. the true economic cost of building it exceeds the economic benefits), households will be forced pay for the net reduction in national wealth. This of course reduces future household income and consumption – the surging of which is supposed to make all these infrastructure projects viable.
The world is in the midst of an “international currency war” according toBrazil‘s finance minister as governments force down the value of theircurrencies to boost their struggling economies
Many countries, notably China, have been deliberately weakening their currencies by selling them on foreign exchanges or keeping interest rates artificially low to make their exports cheaper.
China has resisted pressure from the US to allow the value of its currency, the yuan, to rise. Many countries in Asia, including the host, are reluctant to raise the issue for fear of antagonising China, a major trading partner. Switzerland also began selling Swiss francs on foreign exchanges last year to weaken its currency.
According to investment bank Goldman Sachs, Brazilian currency, the real, is the most overvalued major currency in the world.
China rises and rises, yet still gets foreign aid- China spent tens of billions of dollars on a dazzling 2008 Olympics. It has sent astronauts into space. It recently became the world’s second largest economy. Yet it gets more than $2.5 billion a year in foreign government aid — and taxpayers and lawmakers in donor countries are increasingly asking why. Why? Because the rulers still think people do not pay attention and any way we cannot punish them….
ObamaCare’s redistribution of health – New projections from the federal Cen ters for Medicare and Medicaid paint a stark picture of the impact of the ObamaCare law: We’re in for a massive redistribution of health resources. We passed the law, we now know what is it in it…. Screw all Americans
Buffett to taxpayers: Get over your anger – Taxpayer anger against President Barack Obama and Congress is counterproductive because policy makers took measures including deficit spending to stimulate the economy, billionaire investor Warren Buffett told CNBC. We bent over, should we take down our pants now?
U.S. Wants Broader Internet Wiretap Authority – The Obama administration is developing plans that would require all Internet-based communication services — such as encrypted BlackBerry e-mail, Facebook, and Skype — to be capable of complying with federal wiretap orders, according to a report published Monday. LOL Why they need the law, like they are not tracking us right now
Chris Christie’s Greatest Hits
Global Cooling and the New World Order – Bilderberg. Whether you believe it’s part of a sinister conspiracy which will lead inexorably to one world government or whether you think it’s just an innocent high-level talking shop, there’s one thing that can’t be denied: it knows which way the wind is blowing
United Nations to appoint space ambassador to act as first contact for aliens visiting Earth - If aliens ever land on Earth there will no longer be any confusion over who will greet them with the news the United Nations is set to appoint an astrophysicist to be their first human contact. I wonder who will be Earth ambassador for the Middle Earth, some one needs to greet the elfs too you know… in case they contact us (btw I believe that there are aliens, but appointing ambassador?…what is the job description, what skills you need to be on that post, what experience…?just another waste of millions of dollars, stolen from the taxpayers)
Aliens Are Monitoring Our Nukes, Worry Ex-Air Force Officers – According to the pair, witness testimony from more than 120 former or retired military personnel points to an ongoing and alarming intervention by unidentified aerial objects at nuclear weapons sites, as recently as 2003. In some cases, several nuclear missiles simultaneously and inexplicably malfunctioned while a disc-shaped object silently hovered nearby. Are they trying to save us from ourselves, or try make us defenseless against them? That is the question…
Twitter feeds and blogs tell hidden story of Mexico’s drug wars – Death threats and murders silence traditional reports, catalogue of horror posted by bloggers and on Twitter. That is one hell of a country, that wants to export their poorest citizen to America…Hope the gangsters will not come along too
Computer attacks linked to wealthy group or nation - A powerful computer code attacking industrial facilities around the world, but mainly in Iran, probably was created by experts working for a country or a well-funded private group, according to an analysis by a leading computer security company. May be the aliens as well
TARP II: Banks and Business Don’t Want It – President Obama is crowing about his small-business bill, signed into law on Monday. “It was critical that we cut taxes and made more loans available to entrepreneurs,” he said. Trouble is, small businesses and community banks don’t want Obama’s $30 billion program. That’s right. They don’t want it.
John Paulson: Sell Bonds; Buy Stocks; Double Digit Inflation Coming – Multibillionaire hedge fund operator John Paulson, the investment genius who made a killing going short subprime mortgages a few years ago, told a standing room only crowd at New York’s University Club that double-digit inflation is about to rear its ugly head by 2012, killing the bond market, and restoring strength to equities and gold.
‘Fairness’ at an unfair cost - Obama’s goal is to soak “the rich” in the pursuit of “fairness,” even though the top 10 percent of U.S. households already provide 70 percent of the total revenues collected via the federal income tax.
Can We Save the Goose That Lays the Golden Eggs? – The only way to escape this death spiral – if it can be escaped – is economic growth. We’ve done it before and just maybe we can do it again. And the only way our economy is going to start growing again is to unleash the power of the American people, not doing make-work projects but responding to the needs of businesses each charting their own path through the competitive thicket in search of real profits. No subsidies, no kickbacks, no mandates, no handicaps, no shackles. Just go create more wealth than you consume.
The American dream: Is it slipping away? - The dream is the glue that keeps us all together. It’s the vague promise that our lot will get better over time that gives us the patience to endure whatever indignities we suffer at the moment. It’s the belief that our kids will have a better chance in life than we do that keeps the many elements of this diverse, highly competitive society from ultimately tearing each other apart. More than anything else, it’s the fabled dream that fuses hundreds of millions of separate, even competing individual dreams into one national collective enterprise.
Austerity whips up anger, protests mount in Europe – Painful cuts by overspending EU countries come head to a head with mounting social anger on Wednesday when labour leaders call angry workers onto streets right across the continent.
…When you see the big Wall street guys that were making easy bucks on our backs and bailouts being laid off….
I do not necessarily think it is a bad thing to fire some banksters, but the big picture shows you, that there is NO GROWTH IN THE ECONOMY, NOTHING HAD BEEN FIXED AND I PERSONALLY THINK WORST ECONOMIC CRASH THAN 2008 IS COMING.
Fixed income desks are going to be subject to severe layoffs, according to a highly placed Wall Street insider with information about the plans of his firm and the plans of rivals.
“It’s going to be a blood bath. Volume is down for everything except Treasuries and Munis. These guys aren’t making money and soon they’ll be out of their jobs,” he said.
He is sitting in Grand Central’s Oyster bar. It’s an annual ritual for him: welcoming in September with a frenzy of shell fish and wine.
Typically he invites along a few friends and treats them to a discourse on the state of Wall Street.
“It’s a one-two blow for fixed income. The derivatives are being commoditized and put on exchanges. Swoosh. Now you don’t need half the people you employ to trade and track those. And volume on corporates and agency paper is way down.”
The numbers from SIFMA bear him out. Year to date, the average daily trading volume in US corporate debt is down 2% compared to last year.
Trading in Fannie Mae and Freddie Mac debt is down 7%. Trading in mortgage-backed securities sponsored by Fannie and Freddie is down 13%. And the year to date numbers only tell part of the story. And the part it leaves out is how thin trading became over the summer.
Trading in corporate debt started the year pretty robustly, with $19.7 billion of bonds trading hands in January. But in June, volume dropped down to $14.6 billion and kept dropping right through the summer. The year before, the average daily volume for June was 19.3, so this decline cannot be attributed to merely a summer slowdown.
“We’re easily going to cut a quarter to a half of our traders and back office in fixed income. Everyone else is going to do it too,” he says.
Morgan Stanley, the sixth-largest U.S. bank by assets, froze hiring at its investment-banking division for the rest of 2010, a person briefed on the decision said.
The firm ruled out layoffs through the end of the year, the person said, speaking anonymously because the matter hasn’t been publicly disclosed. Jim Wiggins, a spokesman for Morgan Stanley, declined to comment on the hiring freeze. He said the company intends to hire brokers for the Morgan Stanley Smith Barney unit, a joint venture with Citigroup Inc.
The freeze, which includes the New York-based firm’s sales and trading units, comes as weak trading and equity underwriting volume may lead the five largest Wall Street banks to post their lowest revenue from investment banking and trading since the fourth quarter of 2008. Bank of America Corp. is firing as many as 400 employees in its global banking and markets division, a person briefed on the matter said last week.
Fox Business Network reported Morgan Stanley’s decision to freeze hiring earlier today.
Companies including Barclays Capital and Credit Suisse Group AG also have started reducing staff in Europe. Securities firms around the world will cut as many as 80,000 jobs in the next 18 months as revenue growth begins to slow, bank analyst Meredith Whitney of Meredith Whitney Advisory Group LLC said in a report dated Aug. 31.
Seven analysts including Richard Staite at Atlantic Equities LLP in London cut third-quarter earnings estimates for Morgan Stanley in the last two weeks, citing weak trading in the quarter. The average estimate is 43 cents a share, down from 57 cents, according to 20 analysts in a Bloomberg survey.
