First, you talk of the “US” as if it were a single entity, not a composite of very different interests. What you describe above has MADE A LOT OF MONEY for USA capital owners and rentiers, and increased their political and bargaining power.

USA capital owners and rentiers have used subsidized 3rd world labor as a way to earn much greater profits, and to weaken strategically those USA industries where unions were common; 3rd world countries have used subsidized labor as a way to attract large exports of capital from 1st world capital owners and rentiers.

The US have not “sat by as these huge subsidies were being doled out to the foreign competition of its own firms”, the interests aligned with capital owners and rentiers have supported those huge subsidies as they generated immense rents for them, as “its own firms” were replaced by much more profitable Chinese and Indian offshore production. And “protectionism is retrograde” when it protects the interests of the low paid and working stiff, but it is very good when it results in high returns on exported capital thanks to “currency intervention of Asian countries”.

Yes. Like everything, the pursuit of wealth can be excessive, but wealth gives you choices. If you have massive amounts of money, but want to live like a pauper, you can.

flawed: Look at the faces of people across the world today. Look at the faces on people in the NYC subway as you take the “6″ up or down.

People on the number “6″ train are pretty glum right now because bonuses are slashed and jobs are being lost. A year ago, people were in much better moods. I think that contradicts the point that you were trying to make.

Money *can* buy happiness. It can also buy misery.

It doesn’t always, but if you make wise choices with your money, you will end up happier than if those choices were denied you.

I don’t think so. Industrial productivity is very low in China, and most people still work in very low productivity agriculture. If you boost consumption now, then you lower future productivity increases.

I think it is a horrible idea for China to lower its savings rate. What I think China should do is what the US should have done in 2004-2006, and increase demand by government borrowing and redirecting those funds into infrastructure (both physical and human) development.

People mistake *consumption* with *demand*. It’s important to increase *demand*, but that demand can come from investment rather than consumption.

CHINA’S central bank said yesterday that it plans to implement a pilot program that would settle overseas trade with the Chinese currency instead of the US dollar.

The People’s Bank of China will expand financial cooperation with overseas economies and “properly deal with the global financial crisis,” the central bank said. “We’ll actively join international efforts to tackle the global financial crisis while safeguarding national interests,” the central bank said. It pledged to implement a pilot program that the State Council announced last month.

China will allow the yuan to be used for settlement between Guangdong Province and the Yangtze River Delta, China’s two economic powerhouses, and the special administrative regions of Hong Kong and Macau, according to the central bank.

Meanwhile, exporters in the Guangxi Zhuang Autonomous Region and Yunnan Province in southwestern China will be allowed to use the yuan to settle trade payments with members of the Association of Southeast Asian Nations. Those moves are expected to facilitate overseas trade, as Chinese exporters might face losses if they continue to be paid in US dollars, analysts said.

I am puzzled by the reference to settlement between Guangdong Province and the Yangtze River Delta. I would think they would already be using their own currency for internal transactions. The main point is the idea of using the yuan to settle trade payments with ASEAN countries. This is an ominous step.