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The number 1 thing for ALL these countries is access to resources that they don't have. The most important among them is oil. The only way to buy oil is dollars

The number 1 thing for ALL these countries is access to resources that they don't have. The most important among them is oil. The only way to buy oil is dollars. That's the reason their economy is set up to export to America. The minute oil producers start accepting other currencies (which is what trade blocs such as this could accomplish) or they reduce their dependence on oil (which is what Chinese companies are offering for cheap), these countries will not even try to export to North America because population-wise, America can never have as many consumers as Asia and Africa. Our wealth in America is only because we are the reserve currency. We are not producing goods and services of the future any longer.

threeseed 6y ago
> We are not producing goods and services of the future any longer. Not sure what you are talking about here. Majority of globally successful companies still come from the US and that isn't changing anytime soon.
- nine_zeros 6y ago
  They were "global" before the last 4 years. That won't last without constant nurturing. You should look at China's stock market and what they are able to achieve without printing trillions like the US just did. And we are still not out of covid.
  - CountSessine 6y ago
    Nobody has any faith in the Chinese stock market and the ability of the market to find efficient prices. The entire Chinese banking system is essentially bankrupt. Chinese companies are forced to accept suboptimal business decisions to further CCP goals. In spite of the incredible inventiveness of the Chinese people, companies in China outside of PCB-level board assembly are weak and uncompetitive, having been the beneficiaries of government protectionism (how many countries use Baidu for example). Except for a video-sharing website for teenage girls. And a network switch manufacturer that is subsidized and owned by the government. And the population is getting old before it gets rich, with no social safety net. What does fiat currency even mean in a closed society? Is China solvent or not? What can we say about government debt when private banks are forced to make bad loans at the government’s request? And what can lenders expect back when the government doesn’t respect private property?
    - romanoderoma 6y ago
      According to what source? "In 2019, Fortune's Global 500 list of the world's largest corporations included 119 Chinese companies, with combined revenues of US$8.2 trillion (that's 40% of US GDP). That same year, Forbes reported that five of the world's ten largest public companies were Chinese"
    - blackrock 6y ago
      Are you talking about China or America? Because I could’ve sworn that America was engaging in QE-infinity for the last 12 years. The money printing machines have been running on overtime. There is no price discovery in the American stock market anymore, because the Fed has distorted everything.
- aeternum 6y ago
  > Majority of globally successful companies still come from the US and that isn't changing anytime soon. I've heard this POV many times but it seems very hard to believe. Especially with the internet, the knowledge gap is closing or already closed. Capital is now generally available for good ideas, and access to electronics and computing hardware in many Chinese cities is better than in the US. With 4x the population of the US, many of whom now have access to the whole of human knowledge via the internet, hardware and cheap manufacturing for rapid iteration, how does this not result in change?
  - nine_zeros 6y ago
    This is already true when you see how the Chinese are innovating on energy. They are already the largest producers of electricity. They know that 50% of their population is still poor and more pollution is not the answer. So they invest in high speed public transportation, mass renewables production and scientific research and education for the masses. It's truly stunning scale and most armchair philosophers here in the US just can't appreciate the scale of it until they actually see it.
harryh 6y ago
Our wealth in America is only because we are the reserve currency This is tinfoil hat territory. The US makes, perhaps, a few 10s of billions from seigniorage of dollars held abroad, but that's a very small number in comparison to the US GDP of approx. 20 trillion.
- nine_zeros 6y ago
  You really think the wealth of fiat currency is from seigniorage? For a better measure of understanding how economies are operating, look at GDP (PPP).
  - harryh 6y ago
    I think the value that the US receives for the dollar being the world reserve currency can be best measured this way yes. The US doesn't have a very high GDP because of the dollar reserve currency status. It has a high GDP because it is one of the most technically advanced nations in the world and also has quite a high population. Those things combined enable it to produce a lot of stuff every year.
    - nine_zeros 6y ago
      On currency front, I'd recommend reading up on what happened with the previous reserve currency and see how it was overvalued and ultimately overtaken by US dollar. As for GDP, technology has always been the reason for American GDP. But today, China has caught up technologically and they still have more than 50% of the country yet to develop. That's how much China has left to grow. The direction is clear. Once the US dollar is not the reserve, the dollar will devalue fast and all the statistics which show US number 1 will be up for correction. GDP is one of it.
      - harryh 6y ago
        You're reversing cause and effect here. Previous countries didn't lose their preeminent places in the world because their currency stopped being the world reserve. Their currencies stopped being the world reserve because the countries lost their preeminent places.

threeseed 6y ago

> We are not producing goods and services of the future any longer. Not sure what you are talking about here. Majority of globally successful companies still come from the US and that isn't changing anytime soon.

nine_zeros 6y ago
They were "global" before the last 4 years. That won't last without constant nurturing. You should look at China's stock market and what they are able to achieve without printing trillions like the US just did. And we are still not out of covid.
- CountSessine 6y ago
  Nobody has any faith in the Chinese stock market and the ability of the market to find efficient prices. The entire Chinese banking system is essentially bankrupt. Chinese companies are forced to accept suboptimal business decisions to further CCP goals. In spite of the incredible inventiveness of the Chinese people, companies in China outside of PCB-level board assembly are weak and uncompetitive, having been the beneficiaries of government protectionism (how many countries use Baidu for example). Except for a video-sharing website for teenage girls. And a network switch manufacturer that is subsidized and owned by the government. And the population is getting old before it gets rich, with no social safety net. What does fiat currency even mean in a closed society? Is China solvent or not? What can we say about government debt when private banks are forced to make bad loans at the government’s request? And what can lenders expect back when the government doesn’t respect private property?
  - romanoderoma 6y ago
    According to what source? "In 2019, Fortune's Global 500 list of the world's largest corporations included 119 Chinese companies, with combined revenues of US$8.2 trillion (that's 40% of US GDP). That same year, Forbes reported that five of the world's ten largest public companies were Chinese"
  - blackrock 6y ago
    Are you talking about China or America? Because I could’ve sworn that America was engaging in QE-infinity for the last 12 years. The money printing machines have been running on overtime. There is no price discovery in the American stock market anymore, because the Fed has distorted everything.
aeternum 6y ago
> Majority of globally successful companies still come from the US and that isn't changing anytime soon. I've heard this POV many times but it seems very hard to believe. Especially with the internet, the knowledge gap is closing or already closed. Capital is now generally available for good ideas, and access to electronics and computing hardware in many Chinese cities is better than in the US. With 4x the population of the US, many of whom now have access to the whole of human knowledge via the internet, hardware and cheap manufacturing for rapid iteration, how does this not result in change?
- nine_zeros 6y ago
  This is already true when you see how the Chinese are innovating on energy. They are already the largest producers of electricity. They know that 50% of their population is still poor and more pollution is not the answer. So they invest in high speed public transportation, mass renewables production and scientific research and education for the masses. It's truly stunning scale and most armchair philosophers here in the US just can't appreciate the scale of it until they actually see it.

harryh 6y ago

Our wealth in America is only because we are the reserve currency This is tinfoil hat territory. The US makes, perhaps, a few 10s of billions from seigniorage of dollars held abroad, but that's a very small number in comparison to the US GDP of approx. 20 trillion.

nine_zeros 6y ago
You really think the wealth of fiat currency is from seigniorage? For a better measure of understanding how economies are operating, look at GDP (PPP).
- harryh 6y ago
  I think the value that the US receives for the dollar being the world reserve currency can be best measured this way yes. The US doesn't have a very high GDP because of the dollar reserve currency status. It has a high GDP because it is one of the most technically advanced nations in the world and also has quite a high population. Those things combined enable it to produce a lot of stuff every year.
  - nine_zeros 6y ago
    On currency front, I'd recommend reading up on what happened with the previous reserve currency and see how it was overvalued and ultimately overtaken by US dollar. As for GDP, technology has always been the reason for American GDP. But today, China has caught up technologically and they still have more than 50% of the country yet to develop. That's how much China has left to grow. The direction is clear. Once the US dollar is not the reserve, the dollar will devalue fast and all the statistics which show US number 1 will be up for correction. GDP is one of it.
    - harryh 6y ago
      You're reversing cause and effect here. Previous countries didn't lose their preeminent places in the world because their currency stopped being the world reserve. Their currencies stopped being the world reserve because the countries lost their preeminent places.