Foreigners Buying Up US is Great News
Two similar stories out today are meant to fit the meme, and framed thusly, that our suffering economy has left us open to pillaging by foreigners. First, some Arab oil sheiks are buying the Chrysler Building, no doubt because our addiction to oil and lust to despoil the earth has lined the pockets of of the global economy's drug dealers, yada yada yada. Second, the Italians are buying the Flatiron Building. Same thing, our debt-addicted, consumerist gorging has destroyed the value of the currency versus those prudent, austere Europeans and on and on.
Don't buy in. First of all, this reminds me of the late 80s and early 90s when we got our knickers all in a twist over the Japanese buying up many of our prestigious landmarks. We were afraid that Japan Inc was going to crush us. (Maybe when it came to cars, we were justified, almost everything else though, not so much.) What happened? Nothing really. Michael Crichton got a best seller out of the whole silliness and our friends in the land of the rising sun never did become our corporate overlords. Granted the Japanese were kinda scary with their manufacturing prowess. But the Italians? Tell you what, send me a list of Italian-made goods that dominate the world market. Better yet, send me that list on your Abu Dhabi-designed and manufactured iPhone.
So what ought to be the take away? The dollar has bottomed.
Don't buy in. First of all, this reminds me of the late 80s and early 90s when we got our knickers all in a twist over the Japanese buying up many of our prestigious landmarks. We were afraid that Japan Inc was going to crush us. (Maybe when it came to cars, we were justified, almost everything else though, not so much.) What happened? Nothing really. Michael Crichton got a best seller out of the whole silliness and our friends in the land of the rising sun never did become our corporate overlords. Granted the Japanese were kinda scary with their manufacturing prowess. But the Italians? Tell you what, send me a list of Italian-made goods that dominate the world market. Better yet, send me that list on your Abu Dhabi-designed and manufactured iPhone.
So what ought to be the take away? The dollar has bottomed.
posted by Donny Baseball at 1:19 PM
2 Comments:
"We were afraid that Japan Inc was going to crush us. (Maybe when it came to cars, we were justified, almost everything else though, not so much.) What happened? Nothing really."
Actually, we forced Japan to revalue the Yen and thus put the country and its neighbors into a deflationary spiral for more than a decade. That was what really happened. Had we chose not to throw our political weight into the fight, it would have crushed us economically.
TS-
I am not going to dispute your analysis other than to say that the Plaza Agreement was in 1985. The Nikkei kept skyrocketing through late 1989 and the Japanese were buying our landmarks well into the 1990s. So yes, we did pull some political muscle on them, but I am not sure that we can say that is how the bubble of fear of Japanese economic dominance was burst.
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