Actually Chavez is a threat because he is pumping aid to FARC and helping topple a US friendly govt in Colombia by backing revolutionaries in deep with cocaine cartels.  And also because lefties in Latin America make military deals wtih the Chinese and that can lead to China getting bases on this side of the Pacific.  And Afghanistan makes it clear NATO thinks a US-Asian war leaves them mostly neutral.

National healthcare will cost more unless Obama gets to ration it.  He is as gonzo as people who won't get their kids vaccinnated.  The average american wants a doctor to do 100 tests to be exactly sure why their elbow hurts, they expect a 2nd or third opinion before they get cut, we want the ick cut out before we'll take drug therapy for 20 years, and we want the special version that doesn't have all the gastric side effects before we'll settle for the generic brand.  obama cheerfully assures us we're on crack, which is why his poll numbers are falling like a socialist dropped out of an airplane.  This ain't holland where old people get urged to suck the gaspipe by the National Health Reichamt.

I think the vast majority of the deals the Chinese have with S.America are purely commercial with at most insignificant military/strategic overtones overall.

This is unlike the current U.S policy of encirclement of China with openly building and maintaining military bases in Central Asia, South Korea, Taiwan and Japan. In fact it seems the U.S is maintaining the ability to aerial bomb most Chinese civilian centres with its Pacific carrier fleets and bases in aforementioned countries without having to expect much in the way of similar reciprocation from the Chinese.

There was a big furore near a decade ago when a Chinese company bought up the Panama Canal and all the U.S conservatives at the time started screeching about how they were going to use it to block the U.S navy and stage a communist attack bla bla bla. Ten years on - nada.

China's rise has so far been peaceful and with the way it's engaging many countries with much deeper economic relationships there's little reason to believe it shouldn't remain so. Obama and Hillary know this which is why China has been continuing to help the U.S support its fiscal deficit.

Let's just say we haven't and most likely won't see a Chinese version of the "School of the Americas" opening anytime soon.

I'm actually a supporter of the U.S especially in its war on terror but I think there's a tendency within it to over-hype the China threat which ironically may actually lay the foundations for a self-fulfilling prophecy.

Apparently it was the same when the Japanese had the world's largest economy in the 80s. During that period they were depicted as amoral, near mindless automatons hell-bent on taking everything over and had to be closely watched ...etc. Just have to look at the films and literature from that era to notice the parallels of near-xenophobic suspicion.

>>There is also the fact that China and the US's economies are too interlocked, one cannot go to war against the other without wiping out their economy in the process.<<

They used to say that about Germany and the UK
Our federal govt would have a bad time, our national economy isn't dependent on them.

the official govt position is that OF COURSE China will keep lending to us, they have nowhere else to go!

just like they said the stock market wouldn't let us down and home mortgage lending was the unstoppable gold stream

many people say we'll wait for hyperinflation and then pay them off.

Because we're at a point where they are being repaid interest with the money they spend buying new bonds

Obama's doing the right thing. The U.S cannot afford a prolonged period of deflation which is what would occur if many of these financial institutions were simply allowed to fail. Look at the ridiculous levels of public, corporate and private household debt all across the U.S. A strong period of deflation would easily put a large part of the U.S into bankruptcy.

The Chinese aren't investing in U.S treasury bills for the return, many of the bonds were bought at very low yields. ATM China has decided to continue to support U.S spending but definitely has other places to look if it chooses (copper, oil...etc, other countries' debt).

obviously inflation because of too much spending is better than deflation. deflation is infact 10 times worse

No, inflation is 10 times worse.  the last experience of deflation occurred before the welfare state.  People are not going to starve when a $5 buys 2 loaves of bread, a canned ham and three heads of lettuce again. people WILL go hungry when $5 won't buy a loaf of sliced white.

from WHAT? Oh right all the engines are gonna stop...guess we'll have to do what we always do: hold the world hostage with nuclear weapons

why? that's good eating

I like Jim Rogers and Marc Faber as much as the next guy (The timing of Marc Faber's investment advice is more often right than not) but you have to remember that they both come from a very severe Austrian School view of economics which is considered the opposite extreme of Marxian economics.

The truth is there wasn't really anyone around who had the financial strength to take over these failing companies, ride through the crisis and trade out of their positions at profit or break-even. You're talking about companies like AIG which had -trillions- of dollars worth of derivatives exposure. Around the world, you had individual banks which were holding assets worth more than their entire home country on paper. Many of the takeovers and buyouts which did take place within the financial sector were only achieved with government assistance.

Not to mention the counter-party risk, if a company like AIG fails it has a domino effect on those who it's borrowed from, others holding similar assets they are...etc. Soon enough even what should have been perfectly fine companies become failing ones and so on.

The current solution being implemented globally isn't ideal but the alternative of inaction is much worse.