Posted on 04/14/2008 7:59:20 AM PDT by BGHater
Heres's a big lesson of the first international financial crisis of the 21st century: some old-fashioned economies are weathering the storm better than those that borrowed big to spur growth or those that bet heavily on debt-strapped American consumers.
The US, the economy at the centre of the turmoil, is dragging down world growth. On Wednesday, Federal Reserve chairman Ben Bernanke gave his most pessimistic assessment to date of the US economy's outlook, strongly suggesting that a recession was likely.
In testimony before Congress, he also said the Fed projected slower global growth over the coming quarters.
How the other economies fare could offer important insight that world leaders already are trying to glean.
Over the coming week, the global economy will be at the centre of discussions as finance ministers gather for the spring meetings of the International Monetary Fund and World Bank in Washington. At the top of their agenda: what steps to take to revamp global financial regulation, ease the global credit squeeze and boost growth.
Countries such as Australia, Brazil, the United Arab Emirates and Qatar are still expanding smartly, although down from 2007, because they have rich veins of high-priced oil, iron ore, alumina or copper. Old-line heavy machinery makers such as Germany and Japan are riding out the problem because they have diversified their markets.
On the flipside, consumer-goods exporters of Asia that rode to prosperity by trading with the US - Thailand, the Philippines, Malaysia and even China - are seeing their lofty growth rates sag. And the Baltic countries, Hungary and Iceland, which borrowed heavily to finance growth, are now watched by international financial institutions to see whether they will come unhinged by the credit squeeze.
(Excerpt) Read more at theaustralian.news.com.au ...
The US will survive but the rest of the world won’t.
I hope your right
US debt to GDP ratio is much worse than debt to GDP in the early 1930s. This is a big problem, but Australia ain’t so peachy either:
http://image.minyanville.com/assets/FCK_Aug2007/File/christy/mrp2.png
Most of US debt is to foreign countries which is not always a bad thing. If they don’t trade fair then we could, with a stroke of a pen, tell them to renegotiate the debt or get nothing. The downside to that would be that the 30% of people living beyond their means would then try to barrow from US lenders and that would create a very bad situation if the US lenders continued to allow these people to accumulate US debt. The only true problems in the US right now is people living beyond their means and the Government spending beyond their means.
I don’t! I hope we all get through this.
I will take a little recession now and again rather then have the sort of stagnant moribund high unemployment economies these socialist clown have created for themselves.
Thank you!
Signed,
A Buggywhip Maker
and investors and banks leveraged behond their means.
Bottom line?
It's all boils down to lack of real leadership, insider greed, and a government that spun completely out of control.
Hungary and Iceland have relocated to the Baltic. Good to know.
“an economy that makes nothing is nothing. “
Yep!
As we all know from the same reporters, the Japanese surpassed the US in the 1980’s and is now the world’s economic superpower.
That's the exact same thing I was telling an acquaintance of mine just the other day. I say let 'em drink their own oil when basic food commodities become ever scarcer all across the globe. In the coming global market he who controls the wheat, grain and rice trade will control the world and that will not be the current world powers, IMHO. Food will become the next major world currency.
re the title: piss on whomever.
The article is contradictory.
First it says that China and India’s growth will slow as they are heavily dependant on exports to the US...
...and then it goes on to say that countries with raw materials will ride out the storm because of high demand from places like China and India.
However, the author of the article is blind to the fact that if China and India’s growth slow... so will their demand for raw materials.
How wise and insightful. You said it all. The solution is declaring an energy crisis, becoming energy independent and then exporting the raw and refined materials overseas. But that won’t happen at least until most Americans are either begging for a dime brother or revolting against the U.S. government out of pain. THEN and only THEN will we have the political will to make the change. Why is it not happening now? Politicians get inside information on markets we only dream of. Big oil, global warming, envirowhackos say one thing and invest in big oil. So do Republicans for that matter. A law that forbids investing in energy for a politician and friends and family will change the political landscape spurred into reality by pain and people demanding heads on pikes. Hopefully, I have summed up the solution as well as you summed up the problem.
btt
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