This is a video made from the speech given on 1/28/2011 in which Obama tells Egypt how to conduct themselves against the citizens of Egypt who are protesting. As Obama gives advice, I include video support of examples of how to achieve what he is saying. Finally a video where the words match the video clips and I do hope this is a clear enough manual for the Egyptian leaders to follow.
Video Link http://tinyurl.com/4bnlt4k
BEIJING/NEW YORK (Reuters) – The ultra-loose monetary policy of the United States is setting the stage for "a world credit war," a Chinese rating agency said on Friday, in the latest warning against soaring debt burdens in developed economies.
The Beijing-based Dagong Global Credit Rating firm took concerns about a world currency war to a higher level as it suggested China and other emerging market countries may need to reduce their U.S. Treasury holdings to "avoid unpredictable losses on their own interests."
It also said in its 2011 Sovereign Credit Risk Outlook that quantitative easing by the U.S. Federal Reserve has "eroded the legitimacy of the global monetary system that takes the dollar as the key reserve currency."
The policy easing was "bringing the U.S. dollar's credit-worthiness to a vulnerable position," the ratings group added.
"I think they're aligning some very real threats," said Jonathan Masse, who helps manage $616 million at AlphaShares, a California-based money manager.
"Even if our outstanding debt remains constant over the longer run, the real threat is the interest rate rising. If our credit rating drops, and we end up paying higher rates, there would be less money available to some of these big plans" that President Obama has outlined.
The U.S. Treasury declined to comment on Dagong's report, which followed warnings by the International Monetary Fund and Moody's Investors Service on lack of government action on the U.S. growing budget deficit.
In Davos, however, U.S. Treasury Secretary Timothy Geithner said there was a growing recognition that the U.S. fiscal position is unsustainable. He said political will to put it back on track "is not fully manifest at the moment but it's coming."
Dagong has been rating Chinese corporate bonds since 1994, but it is a relative newcomer to sovereign debt ratings. It created a splash by rating the United States at AA, below China's AA-plus, in July 2010.
It downgraded the U.S. sovereign credit rating last November, following the Fed's decision to pump more dollars into the U.S. economy.
DIVERSIFYING OUT OF TREASURIES?
Although Dagong's statement does not fully represent Beijing's view, it was in line with the government's unhappiness with the U.S. policy easing, which has been blamed by Chinese officials for fueling global inflation risks.
As China's $2.85 trillion foreign exchange reserves are mainly denominated in U.S. dollars, Chinese Premier Wen Jiabao had publicly voiced concerns about the assets.
President Hu Jintao told a recent Group of 20 nations summit in Seoul that China wanted "an international reserve currency system with stable value, rule-based issuance and manageable supply."
Other emerging market powerhouses, such as Brazil, have been accusing the United States of triggering a world currency war with its easy-money monetary policy.
Dagong said in the English-language report that the United States is trying to "haircut" its creditors by permitting a weakening currency.
"The behavior that the United States ignores international creditors' legitimate interests indicates a dramatic decline of the country's willingness to repay the debt," Dagong said.
In defining the "credit war," Dagong said "it aims at encroach on other countries' interests through continuous depreciating the actual value of the currency; and it arouses all the countries in the world to take various credit resources as a financial weapon to safeguard the national interests."
It said capital flows into emerging economies stemmed from cheap dollars and is "a destructive factor to the healthy economic development in different countries."
For full version of Dagong's report, see http://www.dagongcredit.com/dagongweb/english/pr/show.php?id=86&table=web_e_zxzx
PORTUGAL AND SPAIN
Dagong added the sovereign debt crisis in the euro zone countries would intensify in 2011, and it may downgrade sovereign credit ratings of Portugal and Spain.
"Countries, such as Portugal and Spain, will have to ask for bailouts in 2011," it said.
Earlier this month, China reaffirmed a commitment to buying Spanish bonds, while newspapers in December said Beijing was ready to buy Portuguese debt to help it through Europe's spreading debt crisis.
Echoing the International Monetary Fund and western rating agencies, Dagong also warned that the governments in the United States, Japan and Germany will face higher pressure on debt repayment in case of inflation, economic downturns or if investors start dumping their bonds.
Ratings agency Standard & Poor's cut Japan's long-term debt rating on Thursday for the first time since 2002, and hours later Moody's Investors Service warned the risk of a negative outlook on the United States' top AAA rating, although small, was rising. A negative outlook means a credit downgrade is more likely in 12 to 18 months.
The IMF said the G7's two biggest economies needed to spell out credible deficit-cutting plans before the markets lose patience and dump their bonds.
(Additional reporting by Walter Brandimarte in New York; Editing by Kim Coghill and Padraic Cassidy)
