War Between the Uighurs and Han Chinese

“Uighurs are beasts” shout crowds of Han Chinese in the remote northwest of the country. Uighurs are the Moslem minority. Han Chinese are the majority. And, judging from the photos, the Han want to kill the Uighurs.

One thing smart people always do is to underestimate the power of foolishness. It is wild and reckless to stir up a race war. But that doesn’t stop people from doing it. Any kind of war is a blow to reason and civilization. But that hasn’t made war unpopular, even among the most
reasonable and civilized people on the planet.

It was within the lifetimes of many people reading this Markets and Money that the most advanced countries on earth began a war of annihilation. At the beginning of the 20th century, high culture and science were dominated by Germans. German musicians and composers…German poets and writers…German mathematicians, physicists, painters, philosophers – even the German economy was a world leader, second in output only to the United States of America.

Then, the Germans went off their heads – along with the Italians, the Russians, the Japanese…and many others.

But the Han have it right. The Uighurs are beasts from time to time. So are the Han…the Teutons…the Anglo-Saxons…and all the tribes on earth. Occasionally, for no apparent reason, the masks and restraints of civilization give way to mobs…and the old beast starts howling at the moon.

It happens in markets too. What is a bubble, if not a wild and reckless thing? A kind of madness? A mass illusion…a foolishness, in which people leave reason and civilization behind?

What if the United States had to pay its debt in gold?

In the old days, before the monetary reforms of the 20th century…notably, Richard Nixon’s unilateral decision to renege on America’s promise to pay its bills in gold…countries had to settle up with each other in the yellow metal. The system worked well; it was reliable; it prevented bubbles. Edward Chancellor explains:

“A country had to pay for its imports or foreign investments with money gained from a surplus on trade. If more money was sent abroad than had been earned through exports, then gold would be packed onto ships to discharge foreign creditors. A declining stock of bullion would induce the central bank to raise interest rates in order to attract gold from abroad. Rising rates would produce a credit contraction, unemployment and general economic misery. The typical nineteenth century was severe, but short-lived.”

Then came the improvements. And the Great Depression. And now we are faced with another one.

Governments are fighting this one…just as they did the last one…but with much more money. The cost is in the trillions – most of it in the form of public debt. How will these debts be paid? We all expect that they will ultimately be eased by inflation – in full or in part. But suppose the feds had to pay up in real money?

Colleague Simone Wapler compared government debt to government gold. The United States has gold worth about $241 billion, she reports. Its official national debt is $11.5 trillion. That gives it a debt/gold ratio of 48 –
meaning; the feds have 48 times as much debt as gold.

Britain is even worse. Prime Minister, then Chancellor, Gordon Brown sold much of England’s gold at the worse possible moment – about 10 years ago. This leaves the island with only $9 billion worth of gold compared to $1,274 billion of government debt – a ratio of 1 to 139. But Japan is the worst of all. It has $23 billion worth of gold and $7.3 trillion of government debt, for a ratio of 1 to 323. (Of course, Japan has vast holdings of dollars too!)

What nation has the best gold/debt ratio? Switzerland. It has only twice as much in government debt as it has in gold.

Until tomorrow,

Bill Bonner
for 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

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3 Comments on "War Between the Uighurs and Han Chinese"

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It’s not fair for Hans.And most rioters were not citizens of Urumchi ,they were the poor young people in the country nearby.The government gave Uighurs a lot special rights.For example,the enrollment mark of college for Uighurs was 40 lower than ethnical Hans,and Uighur criminal would been punished lightly. But Uighurs were low educated beacuse they was not as studious as Han.In our eyes they are so lazy,and many were thieves and robber.I think all of you knew how hardworking Chinese was. The Uighur were not innocent.They were in the wrong way,they really exasperate Hans.Maybe the leader of this riot would… Read more »
Coffee Addict
Xingjian Riots: The attached wiki link includes key facts, although it may have had a State Security revision. http://en.wikipedia.org/wiki/July_2009_%C3%9Cr%C3%BCmqi_riots In essence, this is part of a sad tale of forced ethic migrations the world over. The saga is not unique to China. I could talk about the forced migration of Indonesians to West Papua, Iraqi Sunni Muslims to Iraqi Kurdistan, Jews to Israel/Palestine, Indians to Fiji, Nationalists to Formosa, Hans to Tibet etc. etc. Ok the migration of Europeans to North America, South America, Australia and New Zealand also had parallel consequences. Not withstanding misdeeds and poor political decisions in… Read more »
The comments of A CHINESE mirror Han sentiments I have heard in Mongolia and I feel they are more widely reflective. One matter often unstated is the personal suffering the Han feel as a result of the one child policy and the exemptions available for the ethnic minorities always lurks in the background that furments retaliatory violence. That these independence campaigns are financially supported by offshore direct and indirect government funding is unquestionnable. Whether it is Paris or London or Washington DC in the US the face of liberal facism and the growth of “social media” as a mechanism to… Read more »
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