money as weapon

the united states has for the past several decades been gaining unhindered access to foreign markets through the banner of "free trade." entities with free trade agreements are forbidden from hindering access to their markets and/or engage in any sort of market protectionism. this system has worked well for the united states. it's corporations can sell their products in another economy, alongside domestic rivals and eventually come to dominate these markets. the same corporations can also have their goods manufactured in foreign countries far cheaper than they could domestically.

according to wikipedia - Protectionism is the economic policy of restraining trade between nations, through methods such as tariffs on imported goods, restrictive quotas, a variety of restrictive government regulations designed to discourage imports, and anti-dumping laws in an attempt to protect domestic industries in a particular nation from foreign take-over or competition. This is closely aligned with anti-globalization, and contrasts with free trade, where no artificial barriers to entry are instituted. there is a list of actions that define protectionism under this description - subsidies, tariffs, quotas, tax cuts, intervention, trade restriction and lastly, exchange rate.

throughout the bush administration, the united states has actively pursued what is known as a "weak dollar" policy. on the surface, it's pretty simple. the value of the greenback, like any other commodity, fluctuates. the "weak dollar" policy keeps the value of the dollar low and other currencies high in the world markets. the reasons for doing this are numerous. it makes american produced goods less expensive in foreign markets. it keeps the actual cost of the deficits lower. it makes foreign products more expensive in domestic markets. there is also talk of it being used to cushion the effects of the coming recession.

the united states is bent out of shape with china because china's currency doesn't fluctuate on a world market. the chinese, not being dummies have decided to let their currency raise and lower, only in accordance with the dollar. upon activation of this system, the yuan wasn't worth very much, so the value of the yuan always is lower than the dollar. the united states has accused china of currency manipulation and said In recent testimonies before the US Congress, scholars and representatives of the small business community have argued that China deliberately undervalues its currency, the Yuan, in order to gain a competitive advantage towards its major trading partners.

since china's currency is always equal in value to the dollar, when the value of the dollar is lower, the value of the yuan is lower, when the value of the dollar is higher, the value of the yuan is higher. since the adoption of the weak dollar policy, china's currency has gone along for the ride. it's value is so low that it's products are much cheaper than domestic ones in most world markets.

the funny thing is the united states is accusing china of currency manipulation, when they are just as guilty as the chinese. both countries use different tactics, but with equal results.

recently, thomas enders - ceo of airbus dropped a bomb in the form of a speech made in building 261 of the airbus compound in hamburg. he called the weak dollar policy "life threatening." before this, newfound american ally nicolas sarkozy said that the united states' "monetary disorder risked turning into economic war." foreign companies are having serious trouble accessing the american market because their products are simply too expensive. a bottle of decent french wine costs twice as much as a sonoma county one. the cost of all european comestibles has increased substantially. foreign carmakers are forced to reduce their profit margins due to the currency imbalance. european economists have warned and complained that this was coming for years and nothing has been done. the problem is that if the united states were to reverse it's policy, it would spell total disaster for the american economy. our ailing economy depends on the weak dollar. there is no reversing course.

so we have the united states accusing china of manipulation. the europeans have also accused china of the same thing and are also accusing the united states of manipulation as well. the rhetoric is now just heating up. what we are about to witness is a new form of warfare fought with money on a global scale. a world war fought with money.

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