Admonishment from China and the Decline of U.S. Credibility

*** A few weeks ago, the Indians were giving America a piece of their mind. This week, it’s the Chinese. The subprime crisis was caused by Washington’s “warped conception” of market regulation, said a Chinese banking regulator… and the Chinese media has gone so far as to compare China’s decisive action in Sichuan Province after the earthquake to the Bush administration’s diddling after Hurricane Katrina.

“U.S. credibility and the credibility of U.S. financial markets is zero everywhere in the world,” says Joseph E. Stiglitz, a professor of economics at Columbia University.

“Anybody looking at this from the outside says, ‘There’s been a lot of hot air coming out of the U.S., so why should we listen to these guys when they didn’t know how to manage risk?’”

The Chinese yuan has gone up 11% against the dollar so far this year.

*** When it rains, it pours. The Midwest has seen the worst flooding in 15 years…pushing up grain prices even higher.

But it could be worse. You could be in Argentina, from which our colleague Paola Pecora reports on the latest conditions (farmers are blocking roads to protest tax increases):

No market for grains
Running out of food and fuel
Inflationary expectations rising
Consumers expect to consume 24% less than the year before
220 roads blocked
An actual 20% drop in consumption spending
74% of people expect higher prices
Increasing poverty
Fall in foreign exchange reserves at the Central Bank
Public debt higher than before the default of 2001
Flight of bank deposits
Real incomes falling

“Things get worse every week,” writes Paola.

Bill Bonner
Markets and Money

Bill Bonner

Bill Bonner

Since founding Agora Inc. in 1979, Bill Bonner has found success and garnered camaraderie in numerous communities and industries. A man of many talents, his entrepreneurial savvy, unique writings, philanthropic undertakings, and preservationist activities have all been recognized and awarded by some of America’s most respected authorities. Along with Addison Wiggin, his friend and colleague, Bill has written two New York Times best-selling books, Financial Reckoning Day and Empire of Debt. Both works have been critically acclaimed internationally. With political journalist Lila Rajiva, he wrote his third New York Times best-selling book, Mobs, Messiahs and Markets, which offers concrete advice on how to avoid the public spectacle of modern finance. Since 1999, Bill has been a daily contributor and the driving force behind Markets and Money.
Bill Bonner

Latest posts by Bill Bonner (see all)

Leave a Reply

3 Comments on "Admonishment from China and the Decline of U.S. Credibility"

Notify of
Sort by:   newest | oldest | most voted

America has lost its credibility because America has lost its mind! Moreover, Americans have neither honor nor morality. In my lifetime (born 1945) America has gone straight to Hell in a handbasket. As the Prophet Hoesea said, “My people perish in their ignorance.” And, as Jefferson said, “Those who wish to remain ignorant and free hope for something which will never be.” Welcome to the USSA!

T. Mathew

I wonder why more people are speak out the obvious. That at least will force present bunch at the helm realize their sucidal course

Yours sincerely

T. Mathew

David Lloyd
The U.S.A.Fox News reporting has the New American Administration including their nutters and all the hangers on under some form of scrutiny, but as in Australia the UNKNOWN Spin Doctors who now control– new candidates– new politicians and old politicians sad to say, can turn a minoritity cause or view into a MAJOR MISSION or on the other hand make it dissapear. BLEEDING Social missions that are succesful wether right or wrong for the majority, carry POWER and POLITICAL OFFICE. When you have full control wether by force or vote its still Dictorial Control.Here There Everywhere. BEWARE OF THE DOG… Read more »
Letters will be edited for clarity, punctuation, spelling and length. Abusive or off-topic comments will not be posted. We will not post all comments.
If you would prefer to email the editor, you can do so by sending an email to