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Source link: http://archive.mises.org/18386/china-as-a-client-state/

China as a Client State

September 10, 2011 by

Lewis Lehrman argues in the American Spectator that dollar imperialism has turned China into a client state of the U.S., and that this is one of many tragedies resulting from paper money. The is a PDF in columns but still worth reading. Thanks GoldStandardNow

{ 5 comments }

FDominicus September 11, 2011 at 3:37 am

Just so much. China does have paper-money too and will not change that. China also has nothing what one can name “freedom”. If you are against the “party” you’ll learn that. So because there is not freedom in China, it’s clear that they will not give-up interventionism, they will always manipulate everything.

And because of non freedom they started this while worthless paper-money stuff.

Just imagine, free money in a dictatorship? Absolutely impossible

A free society never would accept anything but money as value. That we do not have but how many countries left here just says how far away freedom really is. It’s getting even smaller with any speech from nearly any of the politicians. Just remember the 450 billion promise to “create jobs” from Obama?

Ohhh Henry September 11, 2011 at 10:03 am

Funny thing is, practically everyone in China thinks that the communists are an overall benefit to the Chinese because they made China “strong”.

It is a case of the Seen and the Unseen. They prefer paper money whose worthless is in the future and still unseen, and an oppressive but mostly unseen Big Brother controlling their lives, to the highly visible national humiliation of foreign gunboats on their rivers enforcing comparatively free trade facilitated by silver dollars.

Bogart September 12, 2011 at 8:08 am

Two things:
1. China may not have a good handle on their stupid wealth destroying peg to the US currency but the USA is very well aware of the situation and is continuing to take advantage of it. Look at the incredible low bond yields on the securities the Chinese Government has purchased. No sane investor would be buying the massive amounts of low yielding paper.

2. Since when is the borrower the controller of the lender. That is more Krugman crap. I have yet to hear a song sung by banking executives about being beholden to the borrowers. I have heard lots more the other way.

William Palfreman September 14, 2011 at 10:49 am

India was on the silver standard in the 19th century, while Britain was on the gold standard. All this talk of subservient colonial Indians is just ahistorical prejudice. India wasn’t even a colony at all, it was an empire. It was rules by its own kings and princes for the most part, with very limited British control.

The silver rupee was minted according to demand, i.e. supplies of silver. While some were minted by British authorities, not all were, and it doesn’t matter who mints them with a metallic currency. All the talk in the article of Indians havign to consult imperial bankers and not wanting to anger the colonial center is meaningless balderdash. Various overlapping authorities, some princely, some British, invested (gold) money on the London money markets, just like other countries and organisations did.

Anyone who bothers to look can see there was never any kind of currency union across the British Empire. Some places used the Spanish Dollar, some their own version, some pounds, some other standard. It is like the author thinks he can add weight to his argument be repeating “colonial oppression imperial bankers” over and over again.

rodney September 16, 2011 at 8:42 am

the chinese have no choice but to buy our securites. once they accept dollars as payment they have three choices. spend it, do nothing or buy treasuries. they obviously don’t want to spend them. If they just held dollars they pay no interest. that leaves only one choisce and that is buy low yeilding us securities because its better than zero.

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