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> It's worth keeping in mind that trade is not a race or competition. It doesn't hurt us in any way if Europe accumulates wealth quickly. This isn't quite true
by kingkongrevenge 19y ago
> It's worth keeping in mind that trade is not a race or competition. It doesn't hurt us in any way if Europe accumulates wealth quickly.
This isn't quite true. The nations that accumulate capital tend to buy up the high return assets of financially weaker nations. Now that the dollar is tanking, due to the deficits and monetary irresponsibility, you see foreigners snapping up American companies and properties. The dividends from those things are now less likely to be invested here.
- stuki 19y agoForeigners, who almost by definition have less local knowledge than locals (duh), are more likely to be stuck overpaying for less than premium assets, rather than getting the prime ones. The most talked about European investments in the US as of late seems to have been in Chrysler and subprime mortgages. Hardly stellar examples of high return assets. Hollywood has been riding high on this principle for decades, sucking in foreign money like a turbocharged vacuum cleaner on crack, and promptly distributing it to themselves, their lawyers, surgeons, trainers and decorators, as salaries and bonuses. All the while, the local insiders/studios keep the choicest releases to themselves. They only need financing 'help' for the risky, read subprime, stuff. What's really sad, for European savers at least, is that despite being fully aware of this, their homegrown movie industries continue to be an even shittier bet.