The China and the Arabs have a net national savings rate of nearly $4 trillion/year between them (about 60% of that is China and 40% oil profits created by Chinese demand). Much of that is being vented into the world market as both the Chinese and Arabs use it to buy financial assets.
They are certainly buy stocks and bonds hand over fist running those markets into a massive bubble, but they are buying gold too... There is not enough liquidity in the stock market, or even in the bond market, to absorb that many buy orders. So they are buying gold.
If you are a gold bug or stock tulip junkie you had better hope China can keep saving so much. In the past they were unable to save even a tenth of what they are saving now, and the peculiar mix of circumstances that allow them to save so much now will not last forever
Greedful, i agree with much of your economic based posts and also believe we will eventually see a stock market crash and significantly increasing interest rates. But I don't understand your support of the Demoncraps, unless you are supporting them since they will most quickly validate your economic doom & gloom forecasts. Although I obviously dislike the Demoncraps, I also dislike the Republicans. I am a fiscal conservative but a social libertarian. In essence I want our federal government to be fiscally conservative and to stay the HLLLL out of our personal lives - the government should have absolutely no say so on who can marry who and who can have an abortion, among other things. Although the Republicans of late have not been fiscally conservative, they are no where as bad as the Demoncraps of late. Ron Paul would have been a better choice for President but he couldn't have beat Obama or Romney - being an old squeaky voice white guy, he just doesn't look or sound the part - but his economic ideas are good. Anyway, your economic posts are interesting and thought provoking. Keep them up!
Totally agree that GW Bush was actually a Demmoncrap! Reagan was slightly before my time of voting. When I started voting, I was quite liberal and voted for Bill Clinton twice and, although I agree with your statement about Clinton and China, I still like Bill Clinton to this day - best charismatic politician I have ever seen and the USA prospered during his "reign". I'm not sure what a German authoritarian government would be these days (wasn't that back in the 1800's?), but I suspect it would not include the welfare freebies the USA gives to "the poor" and "the minorities". Probably the only way the US can quickly change the current welfare state is to have a dictator and military control of the masses currently on welfare to immediate get them off welfare and working the jobs their education level will allow them to work, which would also include kicking the illegal immigrants out of the country to provide space in the lower paying job market for the lower educated welfare masses. But that is not the "American way" and it will never (or at least not in the near future) happen here. Instead, the Demoncraps will keep control of Federal politics, the Press, and the entertainment industry, and provide more freebies to an increasing number of welfare #$%$ so that the USA can become like Venezuela or Cuba under Hugo Chavez Obama.
The reason for the US prospered under Clinton was because of the policies instituted by Reagan. Be watchful for the backlash ahead caused by the policies of Obama.These presidential policies set are always for years ahead and, begin with gradual implementation.