US Economy - The World is Pissed

A Growing Global Chorus Of Criticism About The US Economy :
Trailing behind the actual current events in the world’s financial markets is a climbing sense of sheer outrage at the conduct of US financial operators in the US Economy. Across Europe, Asia and even in Australia there are now businesses, financial houses and even many small municipal councils which sit and look at losses because they were talked into buying US financial assets. Nobody wants to be taken for a ride and played for a fool, but in places too numerous to mention, that is the repressed outrage being stated publicly.

You’ve Sold Us Garbage While Telling Us It Was “Triple A”:
Some examples of the outrage: Switzerland’s top banker warned of massive losses from the unfolding US credit crisis, describing the earlier collapse in US lending standards as “unbelievable”. Mr Jean-Pierre Roth, President of the Swiss National Bank, said market turmoil was far from over as tremors from the subprime debacle continued to rock the world. A Muslim banker has pointed to the REAL state of the US economy, citing a crumbling US infrastructure, a manufacturing base that has declined 60 percent since World War II, the lowest consumer savings rate since the Depression, an educational system in decline and a shrinking US Dollar. On the basis of FACT, this Muslim banker is irrefutable.

The Escalating Problem Ahead For The US:
The US has a current account deficit past the $US 800 Billion mark on an annual basis - which requires that the rest of the world funds it with new loans to the US. It has an external debt above all historical records by at least $US 4.5 to 5-2 TRILLION. The US Treasury is now right up against its official debt ceiling of close to $US 9 TRILLION. Taking all this into account, the US should have been the last nation on earth to have taken the rest of the world for a ride. But it did. The US has to go back to the rest of the world to get its external and internal deficits funded. That means that the US has to sell more of its financial paper to the rest of the world to get these funds. What happens if even a part of the rest of the world says: “No thanks, we tried your ‘toxic sludge’ (subprime loans) already.” What happens if normal foreign loans to the US are not rolled over so that the US has to actually repay these older loans?

Poisoning The Well From Which The US Drinks:
What will happen if the US cannot get sufficient funds from the rest of the world is that it will have to start repaying older foreign loans. What happens if the US either cannot or will not repay these loans and instead puts in place an external payments moratorium? What happens then is a global financial crash of enormous dimensions as foreign lenders cannot get their money back.

What happens if the rest of the world sees a sign saying: FORECLOSURE USA - debtor has defaulted?
©2007 - The Privateer
http://www.the-privateer.com
capt@the-privateer.com
(reproduced with permission)

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