We made our bed..............

...........now we have to lie in it. Decisions were made years ago by many corporations to transfer production bases to China, which had the dual effect of destroying our manufacturing base and giving the Chinese an incredibly powerful form of leverage over our economy. By doing this, U.S. dollars began to flow OUT of the United States, and into the hands of China's central bank. Now, the Chinese Government is flexing some of that newfound economic muscle: http://www.cbc.ca/money/story/2007/11/07/dollar-overseas.html. Specifically, it's going to sell off Greenbacks, thereby driving down the value of the currency even further.

I've said before and I'll say it again: China IS our enemy. They're not "in your face" the way Iran is, but that's just because they are more subtle in the ways they choose to exercise their power. Make no mistake about it, however. China, Russia, Iran, they all want the same thing, which is a cowed, economically-hobbled United States. Worse yet, with our short-sighted (and arguably non-existent) economic policies, we have allowed our enemies to exert control over our economy, and to control (to a large degree) the value of our currency.

The situation is to put it mildly, bleak, and it will take years for us to come back from this.

UPDATE (5:05 p.m.): That thud you heard is the other shoe dropping. The Dow Jones Industrial Average was down 360 points today, based on the neverending credit woes AND the seemingly unstoppable fall of the dollar: http://news.yahoo.com/s/ap/20071107/ap_on_bi_st_ma_re/wall_street.