Hong Kong Election 2017
Waken Up Lions

Central District, Hong Kong

#161 Jan 18, 2014
Definitely. Citizens should be well informed.

Let Hong Kong Citizens know that:

(1) The Hong Kong Government cannot print money directly under the present policy.

(2) However, with Mutual Credits with the Central Government of China, money supply is effectively increased. Sending tourists to Hong Kong is a slow way. The financial act of a Mutual Credit Arrangement is quick. Hong KOng with its top financial brains will be able to understand Mutual Credits and implement it properly.

(3) With Government directing the distribution of such money, the gap between the rich and poor can be narrowed.
Lion W

Central District, Hong Kong

#162 Jan 18, 2014
Who is the economist(s) that dreamed up Mutual Credits?
Lion W

Central District, Hong Kong

#163 Jan 18, 2014
Lion W wrote:
Is it a good idea to let all Citizens know the following:
(1) Governments can and should increase the money supply in step with the increase of Meaningful Economic Activities. All Citizens can be wealthier.
(2) With Mutual Credits, Government A gives some of its currency (print if needed) to Government B and vice versa. You stimulate my economy and I stimulate yours. Trade with many nations can increase in a planned fashion. Every Nation can use its unique advantage to benefit itself and the rest of the World.
(3) One World, one Dream will become reality.
NO, NO, NO.

Citizens will become lazy and rely on Government for handouts.

Governments will just turn on the printing machine.

Some information should be confidential and restricted.
Waken Up Lions

Central District, Hong Kong

#164 Jan 18, 2014
Dear Lion W,

We have a big difference here. You want to keep the powerful concepts confidential. I want to pass them to all Citizens asap.
Lion T

Central District, Hong Kong

#165 Jan 18, 2014
Waken Up Lions wrote:
Dear Lion W,
We have a big difference here. You want to keep the powerful concepts confidential. I want to pass them to all Citizens asap.
Your concepts are still in their infancy. Be humble.
Lion W

Central District, Hong Kong

#167 Jan 19, 2014
You have put Mutual Credits in layman understandable terms. Mutual Credits is not simple currency swap.

No wonder Japan is copying - increasing currency swap with India from $15b to $50b. Next year, the number may be $150b.

What possible role can IMF and World Bank play? Developing Countries do not even need to borrow?

China, Japan, India, etc are playing by the new rules. Will USA follow?
Waken Up Lions

Central District, Hong Kong

#170 Jan 19, 2014
Coming back to the Hong Kong Question. Can Hong Kong Government increase revenue by HK$20 Billion annually without increasing salary tax rates?

The Answer is YES.

(1) Develop Lantou Island and Land around the Hong Kong-Zhuhai-Macau Bridge. Selling the land systematically to raise HK$20 billion a year is possible. Turn that into a tourist resort.
(2) China can always pump in more high spending tourists to increase Meaningful Economic Activities.
(3) China can do some type of Mutual Credit Arrangement with Hong Kong. Or Hong Kong can join China on some Mutual Credit Arrangements with other Nations.
(4) Hong Kong Government can issue Bonds to use the untapped billions (or trillions) of “Rich man Shelter Money”. The announced intention may be to issue Bonds to develop new Townships.
Thus raising the additional HK$20 billion per year should not be a problem.
Waken Up Lions

Central District, Hong Kong

#171 Jan 19, 2014
Innovation focus for Hong Kong.

Hong Kong is privileged to have huge reserve and also has China as Backup. There is no need to spend any money on defence.

One question raised in the 2014 Policy address is - Hong Kong should have a focused Innovation, science and technology Department.

What kind of innovation focus should Hong Kong take?
Waken Up Lions

Central District, Hong Kong

#172 Jan 19, 2014
In Memory of Mr. K. F. Cheung (the late Chairman of Hong Kong Invention Club)

Hong Kong Citizens focus on short term successes. Long term basic science research and development (requiring decades to produce results) will not get support. Success that can be profitable quickly will be appreciated. Our suggestions are::

(1) Remote Monitoring, Control and Management technology on-line for Investors. Some people may argue that such technology already existed. For example, fast food chains already have the Computer Systems to receive orders. Add some video hardware and software; some accounting software; some Internet display and analysis software and the solution is available. Can Hong Kong extend this to retail chains, service chains, farms, factories etc? The investor (or financial) world will be eager to cheer and give credit.

(2) Improved ways of using Energy. Can model farms be developed using as much renewable energy as possible? What kind of combination of livestock and crop will be best? Such model farms have similar technology but may vary much in implementation depending on climate and other conditions. China is increasing trade rapidly with Africa. Africa has much solar energy and fertile land. Potentially, Africa can be one of the top food producers. Can the Hong Kong Innovators, scientists and engineers help in this process?

In my opinion, focusing on these two areas will bring success and fame to Hong Kong. Use of public funds will be supported.

Waken Up Lions
Lion T

Central District, Hong Kong

#173 Jan 19, 2014
Hong Kong Government cannot just print money uder the Basic Law. The authorized Banks must put the amount to be printed (in US Dollars) to the Hong Kong Monetary Authority first. That is why Hong Kong Government has such a huge reserve.

Also, in order to protect the US dollar peg, the Hong Kong Monetary Authority can sell or buy Hong Kong Dollars (mainly sell).

My question is:
Under such constraint, how can the Hong Kong Government get more money to spend using the Mutual Credit Arrangement?
Waken Up Lions

Central District, Hong Kong

#174 Jan 19, 2014
Let us assume a Mutual Credit Arrangement of RMB 200 billion between Hong Kong and China. The 200 billion RMB is given to the Hong Kong Government for it to spend! The equivalent HK Dollar is given to the Chinese Government to spend.

The Hong Kong Companies and Citizens accept both Hong Kong Dollars and RMB in trading and saving. The RMB is actually more preferred in saving purposes as it is expected to appreciate against the US Dollar.

Hong Kong Government can “spend the received mutual credit money” on social services or any other purposes without violating the Basic Law. The money is effectively “printed” with the blessing from the Beijing Government.

Beijing can do whatever it wants with the Hong Kong Dollars. It can just store the numbers on the books. The actual exchange will be numbers rather than physical bank notes.

Thus Hong Kong never needs to touch its reserves. Spending the additional HK$20 billion annually on worthwhile projects will not be a problem.(The above example allows for 10 years spending. Such an agreement was signed in 2009!)

I am sure that the financial experts in the Chinese and Hong Kong Governments will be happy to explain the details further.
I can read

Edinburgh, UK

#175 Jan 19, 2014
The mutual credit arrangement you speak about is clearly a con job.

Say there are 2 African countries who have lots of wood to sell. They can sell it or the rights to harvest it and spend the money they get buying whatever they want in the free market at the best prices they can.

Alternatively they can use this dodgy arrangement you call 'Mutual credit arrangement'. China gives $1Bn of Chinese goods to country A and country B. A and B have to accept these Chinese goods even if there are cheaper or better alternatives anywhere else.

The understanding is that one day China can call in the debt and A and B will each have to give China $1Bn worth of wood at market value.

Of course this market value is set by market forces and the laws of supply and demand. When China calls in one of the debts, the cost of wood in the world markets will drop significantly as A or B are essentially forced to supply $1Bn dollars worth of wood.
The other country still has an obligation to supply $1Bn of wood but now with the value dropping, you get much more wood for your $1Bn.

China can force A and B into other political and economic concessions just to avoid the massive cost of being the second country China calls in the debt from.
So beyond the lack of interest payments in the short term, what possible benefit would any country have in taking China up on their dodgy offer?
Waken Up Lions

Central District, Hong Kong

#176 Jan 19, 2014
I can read wrote:
The mutual credit arrangement you speak about is clearly a con job.
Say there are 2 African countries who have lots of wood to sell. They can sell it or the rights to harvest it and spend the money they get buying whatever they want in the free market at the best prices they can.
Alternatively they can use this dodgy arrangement you call 'Mutual credit arrangement'. China gives $1Bn of Chinese goods to country A and country B. A and B have to accept these Chinese goods even if there are cheaper or better alternatives anywhere else.
The understanding is that one day China can call in the debt and A and B will each have to give China $1Bn worth of wood at market value.
Of course this market value is set by market forces and the laws of supply and demand. When China calls in one of the debts, the cost of wood in the world markets will drop significantly as A or B are essentially forced to supply $1Bn dollars worth of wood.
The other country still has an obligation to supply $1Bn of wood but now with the value dropping, you get much more wood for your $1Bn.
China can force A and B into other political and economic concessions just to avoid the massive cost of being the second country China calls in the debt from.
So beyond the lack of interest payments in the short term, what possible benefit would any country have in taking China up on their dodgy offer?
You totally misunderstood Mutual Credits. NO debts ever occurred.

When China introduced this to undermine the US Dollar, the IMF and World Bank, China must have done the thorough analysis, computer modeling etc. Some Western Countries are now adopting it - UK and European Union.
old head

Central District, Hong Kong

#177 Jan 19, 2014
The way I understand Mutual Credits is that:

(1) It is between Governments.
(2) Once the currency is swapped, the Governments can use the money at its discretion.
(3) Buyers from Country B can buy things from Courtry A with the currency of Country A.
(4) The buying can be now or anytime within the agreed timeframe.
(5) No Debt or loan is ever involved.
Lion W

Central District, Hong Kong

#179 Jan 20, 2014
Previously, USA encouraged the Private Enterprises in different Countries to compete against their Giant Multinationals. Obviously, they won.

Now China encourages these Giant Multinationals to compete again the Colossal State Enterprises. Obviously they will win.

Free Market is biased towards those with deep pockets. Small Mom and Dad shops have zero chance.

Mutual Credits is biased towards State Capitalism. Single Companies have zero chance under such rules.

David winning against Goliath was an exception. I would have put my bet on Goliath…..
I can read

Edinburgh, UK

#180 Jan 20, 2014
Waken Up Lions wrote:
<quoted text>
You totally misunderstood Mutual Credits. NO debts ever occurred.
When China introduced this to undermine the US Dollar, the IMF and World Bank, China must have done the thorough analysis, computer modeling etc. Some Western Countries are now adopting it - UK and European Union.
No debts are incurred?

So none of these countries china gave goods to ever have to give anything back?

Is that REALLY what you are trying to claim?

The above example I gave is perfectly accurate. I notice you haven't even attempted to poke holes in it, you've just made the ludcrous claim that your con job idea doesn't involve debt.
I can read

Edinburgh, UK

#181 Jan 20, 2014
old head wrote:
The way I understand Mutual Credits is that:
(1) It is between Governments.
(2) Once the currency is swapped, the Governments can use the money at its discretion.
(3) Buyers from Country B can buy things from Courtry A with the currency of Country A.
(4) The buying can be now or anytime within the agreed timeframe.
(5) No Debt or loan is ever involved.
What you just described is a currency exchange.

China buys dollars with RMB then does whatever it wants with them.

The mutual credits bollocks is a con job, just like I explained.

Also, when the term CREDITS is in the name, it's fairly obvious there is debt involved. If one side gets a credit, the other automatically gets a debt. That's what credits ARE.
I can read

Edinburgh, UK

#182 Jan 20, 2014
Lion W wrote:
Previously, USA encouraged the Private Enterprises in different Countries to compete against their Giant Multinationals. Obviously, they won.
Now China encourages these Giant Multinationals to compete again the Colossal State Enterprises. Obviously they will win.
Free Market is biased towards those with deep pockets. Small Mom and Dad shops have zero chance.
Mutual Credits is biased towards State Capitalism. Single Companies have zero chance under such rules.
David winning against Goliath was an exception. I would have put my bet on Goliath…..
China encourages competition?

Bullshit.

You just described the situation of how China tries to force a monopoly (using illegal practices) as an example of how they encourage competition?

You didn't attend school in Hong Kong, did you? You went to one of those mainland CCP indoctrination camps
Lion W

Central District, Hong Kong

#183 Jan 20, 2014
Dear I can Read,

I am going to describe the application of Mutual Credits on the case you presented here.

The assumption is that there are two African Nations A and B both produces timber. They want to sell the timber to buy goods and services aboard to develop their economies.

(1) Nation A uses the traditional model. It tries to find International Buyers. The total amount Nation A wants to get is US Dollar 1 Billion. The price of timber is subjected to Market Forces. To avoid exchange rate risks, Nation A uses US Dollars as the trading currency. If the selling is successful, Nation A will have some US dollars to spend on anything it desires.
(2) Nation B uses the Mutual Credit Arrangement with China. China does a Mutual Credit (or Currency Swap) of USD2 Billion with Nation B. Note that the amount is much higher than the USD1 Billion desired. In the Currency Swap, Nation B gets approximately $12 billion RMB (Chinese dollar) equivalent to USD2 billion. At the same time, China gets $X billion of Nation B currency. No debt ever occurred.
(3) Nation B gets $12 billion of RMB to spend on Chinese goods and services immediately! Nation B does not even need to ship out a single piece of timber at this point.
(4) China gets $X billion of Nation B currency. China then uses $0.5X to buy the timber. With the additional $0.5X, China buys land or does other projects (notably infrastructure projects) in Nation B. If a road is needed, China has $0.5 billion to pay the Nation B workers. China will pump in additional machinery, workers and other resources.
(5) In most cases, China will buy land in the strategic locations. Land and property values are expected to increase many times after successful infrastructure development.
(6) The end result is that Nation B has the equivalent of USD2 Billion to spend to buy Chinese Goods and Services at its discretion. It may even use some of the RMB to buy goods from another Nation. In most cases, it will ask China to do some infrastructure projects (e.g. build roads). More jobs and more learning within Nation B. The Government looks good.
(7) China has USD1 billion worth of timber. China invested in Land, Property or other assets in Nation B. USD$2 billion worth of Chinese Goods are likely to have found a eager Buyer. China has generated good will in Nation B.
(8) The USD dominance is broken. If Nation B does not need to spend the full RMB 12 Billion, some RMB will be kept in reserve. China will automatically have RMB as the “reserve currency”.

This is a win-win strategy. Nation B gets more money than its initial goal. Its currency is respected and is used by China to help to develop its economy. China has found an eager buyer for its goods (no need to depend on USA for export growth). China undermines the IMF and the World Bank; the RMB will become a preferred reserve currency; the Chinese GDP will continue to grow at 7.5% or whatever the Beijing Government desires totally independent of World Economy.

(Both Nation B and China can increase their money supply in step with the increase in Meaningful Economic Activities.)
Waken Up Lions

Central District, Hong Kong

#184 Jan 20, 2014
China found that in the traditional model. it has a trade surplus against USA.
Result - buy USA Government Bonds and just stare at the paper.

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