What you're saying, Z, is that in a "Global" economy you've gotta have a "Global" Currency. A "Clearinghouse," if you will. A traffic cop.

The Dollar is It. When "push" comes to, "shove," they all run home to "Mama," and, "Mama" is the U.S. Greenback.

We've, somehow, got to get the money from the manufacturing, oil-producing nations to the customer (laboring) nations. Somehow, we've got to organize a mass lending from the U.S., Euro, Chinese, Russian governments (taxpayers" to the Azerbaijani, Ukrainian, Hungarian banks.

Jeez. Well, nobody said it was all gonna be "Easy."

It was like when the US was running a big deficit with Japan in the 1980's. The wisdom was the US was getting the goods and the japs were getting bits of paper in return. The same thing is happening with China, and the Chinese have just realised.

I'm not sure that is the way I see it.

I think they may have seen that the time was running out on exporting worthless dollars for solid commodities, and decided to do as much as they could now, to max out the credit cards, before time ran out. I am not inclined to think that people conspired to hurt other countries. I think that more likely they convinced themselves that the countries would truly be better off if they borrowed a lot of money and emulated the "developed countries". Of course, the time when commodity growth could be cheaply expanded ran out, making it much more difficult for these countries to repay their debts.

You might be interested in a post I wrote quite a while ago with Shunyata. It was called Monetary Policy and Weaseling Out of Debt.

I don't think it's been as blatantly planned out as what you say, but the fact is that the US Government (and others around the world) will try nearly whatever it can to keep the standard of living from dropping in the short term. Just as much as this means taking wealth from other countries, it also includes taking potential wealth from future generations.

Just like a company that doesn't care about the fate of the world, but only cares about this quarter's revenue or its current stock price, the government and most people in general are blind to future problems. They just want to get profits now.

Just think of how easily people can say "unsustainable". Nearly everything we do has long been known to be "unsustainable". In school, I learned about "renewable" and "nonrenewable" resources, and I knew that oil was nonrenewable. But that simple fact doesn't dissuade anyone from slowing their usage of nonrenewable resources until a crisis appears and they don't have the means to consume like before.

There is no question that the government is partially responsible for the commodity price collapse. The futures markets and naked short selling show that you can sell massive amounts of paper that represent commodities even if demand for those commodities is exploding. Take silver, for instance. We're currently going through the largest shortage of silver in history, as far as I know. I tried to order some today, and the company said that they might be able to get it to me by April of next year, and if not, I could get my money back. (Imagine if your local gas station told you that you could reserve your 10 gallons of oil - that you need to get to work today - for delivery in April!) Does that situation seem natural to you? Normally, with that demand, silver would be at $50, not $10. But there's much more paper silver out there than real silver, and the paper silver is being sold like at no other time in history. However, there will come a time when more people want to take delivery of silver (cashing in on those promises). This will crack the COMEX. It's like in 1971. Under the Bretton Woods system, the foreign countries could exchange their U.S. dollars for gold at a certain, unchanging rate. Well, there were more dollars (or paper promises) for gold than there was gold. France realized this and started demanding gold. This alerted the world that the gold price had been unfairly suppressed. Nixon then nullified the dollars' convertability into gold. This will happen again with the suppressed price! In 1970, gold was $35 per ounce (fixed). In 1980, gold was over $600 per ounce. Even when it was realized that gold was overbought and the price came down later, it still never went back down into the double digits. I expect that soon, the triple digits will seem very low. This price does not even take into account inflation. When you add that in, it becomes very easy to see why the government and corporations wanted to get the prices of commodities as low as possible in preparation for an explosion.