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What's at Stake in the New World Order: Part IIRead the article this discussion is about
This archived discussion is "read only". « Previous 1 2 3 4 Next » » pseudoerasmus - Re: Re: Re: Further thought In response to message posted by GeraldS_2:...the ratio of current deficit to GNP includes the Mexican (for example) production in both the current account and the GNP. This means that an increase in Mexican production results, not only in an increasing current deficit, but also in an increase in GNP. Or as you have pointed out, the Mexican production is a component of GNP. Complete nonsense. Profits repatriated from American-owned production in Mexico are counted in American GNP, but not the value of items imported, which are still deducted from GNP like any other imports. I repeat:
case #1: current account balance = -1500 +1300 = -200 And, therefore, the current account balance as % of GNP is unaffected however the engine is priced by GM. Pseudo, a transnational corporation is certainly in possession of greater power than is one confined within a single state. How? Will we see the continuation of merger mania in the media with the pooling of resources of Russian, British, French, American and Canadian television companies? Don't hold your breath. And when that occurs, will the FCC be able to exercise some control over the combined power? Why not? -- posted by pseudoerasmus » bryankay - Re: Re: Re: Re: Re: Further thought Don't you guys have jobs to go to? It seems your heated discussion led the two of you into thinking that you were right and the other was wrong, and somewhere along the way got so angry neither of you could see the flaws in the others arguement.Excuse me for butting in, but it was an interseting article - it possibly went a little too far. Very clearly, you are both passionate about the subject, so I guess I should look forward to future articles - as soon as you drag yourselfs' away from this that is! -- posted by bryankay » GeraldS_2 - Re: Re: Re: Re: Re: Re: Further thought In response to message posted by bryankay:Hi Bryan. It is interesting to believe someone reads all or part of our discussion. I know it probably bores most people. Don't you guys have jobs to go to? It seems your heated discussion led the two of you into thinking that you were right and the other was wrong, I am long retired, 74 years old and uneducated. Pseudoerasmus is a post graduate student majoring in economics. It is also obvious that he probably possesses a very high IQ. We have been arguing this subject for several years now. He always wins the argument which is what I expect......but you see, this is much cheaper than returning to the university. I will probably never learn any small percentage of his knowledge, but I do read books and sometimes amaze my friends by presenting my definition of GNP or something else which I have learned from him! Bryan, your message was really complimentary to me because the last fellow who did that accused Pseudoerasmus of being a ventriloquist and me of being his dummy! Seriously, though, I read a good deal relative to economics, including Krugman (Pseudo's patron saint) but mostly Naom Chompsky, William Blum, and several other very intelligent people who disagree with Pseudo and who also appear quite intelligent. -- posted by GeraldS_2 » GeraldS_2 - Re: Re: Re: Re: Further thought In response to message posted by pseudoerasmus:Just one more question Pseudo. Suppose Toyota establishes a subsidiary in U.S. and General Motors builds a plant in Mexico. Now the profit GM makes on its Mexican operation is invested into the U.S. GNP. But the profit enjoyed by Toyota on its cars made in Japan is credited to the U.S. plant, but really used to purchase shares on the NYSE. Question: Is the Toyota profit included in GNP or in the capital account of our current deficit? Since the current account is included in our GNP, one would expect it to appear there. But the wealth generated by the American operation is mostly vested in the Japanese stockholders because the factory is foreign owned. As I understand it, the current account and the capital account are nearly equal and separate. -- posted by GeraldS_2 » pseudoerasmus - Re: Re: Re: Re: Re: Re: Further thought In response to message posted by GeraldS_2:Now the profit GM makes on its Mexican operation is invested into the U.S. GNP. Suppose Toyota establishes a subsidiary in U.S. and General Motors builds a plant in Mexico. Well, the profit GM repatriates from operations overseas is part of US GNP. But the profit enjoyed by Toyota on its cars made in Japan is credited to the U.S. plant, but really used to purchase shares on the NYSE. No. Toyota's situation parallels GM's. GM makes parts in Mexico, exports them to the USA, and assembles the car in the USA. Toyota makes parts in Japan, exprts them to them, and assembles the car in the USA. The only difference is that Toyota's profis would go into Japanese GNP. Question: Is the Toyota profit included in GNP or in the capital account [or] our current deficit? Toyota's profits from Toyota-owned factories in the USA are counted as part of Japanese GNP, but the value of the output of the Toyota factory in the USA is part of American GDP. As I understand it, the current account and the capital account are nearly equal and separate. Current account = exports - imports + net factor income from abroad Capital accuont = capital inflow - capital outflow Balance of payments = current account + capital account = 0 The current account exactly offsets the capital account. In practise, there is a small statistical discrepancy because the books on the current account and the capital account are kept separately. But that's just a quirk of book keeping. The statitsical discrepancy in 1999 was about $11 billion. The US balance of payments. Of course in countries with poor credit records, capital doesn't flow as eagerly and the current account & the capital account need not match -- that's when you have a balance of payments crisis. -- posted by pseudoerasmus » pseudoerasmus - Re: Re: Re: Re: Re: Re: Re: Further thought In response to message posted by GeraldS_2:Chomsky is a crank, not just in economics but in politics as well. But William Blum??? Chomsky is at least a high-brow crank. William Blum is low-end even for cranks. -- posted by pseudoerasmus » pseudoerasmus - blum and chile Well, I have a detailed critique of William Blum's views on Chile. Unfortunately, they are archived at Salon magazine's Table Talk discussion forum. You can access them, but you need to be registered (free) in order to have access.-- posted by pseudoerasmus « Previous 1 2 3 4 Next » Please follow the guidelines set forth in the Suite101 Posting Etiquette when adding to the discussion. |
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