Here is my take as a former Republican, speaking to my new Democratic compatriots:

Will you people stop being so fussy? Geez, we have an election coming up. I remember all the progressives’ consternation about Barack’s shift on FISA…the man is trying to get elected, for Pete’s sake! Let’s get our people in power AND THEN worry about fixing things the right way. You have to play the game in politics – the people are too stupid.

Only when smart people (like most of the people on this blog) divide do Naval Academy flunkies and community college and tanning booth bimbos get the chance to rule the world.

This is the Dems’ opportunity to step up. If they buy the Paulson F-150 at this point, they’re utter s*** in my book.

Agreed. What can’t go on forever, won’t. And it’ll eventually be hard to fuel nuclear-powered aircraft carriers with toilet paper.

Donkei – I agree on the nukes argument (meaning, that’s pretty much what we have going for ourselves), and partly on the Chinese not wanting to make their dollars worthless. I don’t think anyone wants a precipitous sell-off. But at some point, the Japanese, the Chinese, the Saudis, the Russians will figure out that we are trading for real manufactured goods and raw materials with the physical equivalent of toilet paper. Clyde Prestowitz figured the dollar was overvalued by 30% or more against the Asian currencies because of Japanese and Chinese central bank protection of the dollar, but we will not be able to rely on that indefinitely.

Enjoy your Republican free markets, everybody.

aparently a deal was made with China. They will finance the bailout but they will get Taiwan.

http://www.moonofalabama.org/2008/09/selling-taiwan.html#comments

My guess: the chinese made a very good trade…

The last thing China wants is to see its dollars turn worthless, which can also be said of the rest of the creditor nations, like the Saudis and Japan.

Paulson’s plan therefore won’t immediately destroy the dollar–the dollar still carries a huge liquidity premium for its status as the international trade and reserve currency. Paulson’s plan, in fact, leverages the dollar’s international reserve currency status. It would not have been conceivable, for a country, e.g., like Argentina, to pull off this shell game without severely crimping the local economy. Paulson thinks (hopes) the strength of the dollar will carry him through.

International reserve currency status is closely tied to military might, specifically the power of a blue water navy to enforce contracts and keep trading lanes open. Like Bruce alluded to, sterling was the IRC until the British empire crumbled.

As I’ve said before, at least we’ve still got nukes. Or, maybe it should be, “at least we’ve still got nuclear-powered naval carrier groups.”

Well, I would take a little different take on your China is broke statement. China is an emerging country, and very poor. Granted. China has inherent problems just because they are communist. Granted. However, China is our main manufacturing hub for everything from car parts to t-shirts, and therefore they are definitely not broke.

Something as simple as taking dollars as they come in and swapping them for Euros and Yen would put enormous pressure on the USD..again, they should be seeing this for what it is….a huge debtor nation that has refused to take their medicine for 40 years.

Can’t happen to us? The British prior to about 1910 probably felt much the same.

On the other hand, credit default swaps on US debt are way up: http://www.bloomberg.com/apps/news?pid=20601039&sid=arxBaDnXNMxY&refer=home

At least we’ve still got nukes.