The worst is over?

[thro]

Don't get me wrong, our economy isn't in great shape by any stretch.


We are *nowhere near* as badly fucked as the US is though. Our downturn is related to other countries being in the shit (mostly due to "the sky is falling" stock market related fallout). Not due to fundamental problems with our rate of consumption vs production.

If the asian countries simply stop extending credit the US, there will be short term pain, yes - but once they do, all the production (ie, work) that their workers do will be going into their *own* economies, rather than the US.

China, in particular will stop being third world, and you'll see an explosive improvement in technological advancement, economic development, etc...

We, and the rest of the world might be a bit fucked up for say 5 years.

The US is going to be in the shit for far longer than that.

[g0zer]

China, in particular will stop being third world, and you'll see an explosive improvement in technological advancement, economic development, etc...

yeah

the return of the southern song

and pay back time for manchuria

[Desmo]

The US is going to be in the shit for far longer than that.

[thro]

^^ lol.

Jules: if you're getting paid in USD at the moment - good for you.

Make hay while the sun shines, as they say.


I'd be keeping your options open though.

[jules_1972]

^^ lol.

Jules: if you're getting paid in USD at the moment - good for you.

Make hay while the sun shines, as they say.


I'd be keeping your options open though.

I hear you Thro.

Seen it before in 2001, exchange went rapidly from 0.52c in 6 years to 0.91c!!

[thro]

kerching...

US rejects China's call for new world currency | The Australian


china looking to stop extending credit to the US by buying the greenback anymore? the first signs of the dollar collapse perhaps?

Obama said he didn't think there was any need to create a new global currency.

No doubt this is his opinion, because if there was a new currency he'd be fucked...


Obviously, china with ~$1tn of US debt (by now - US treasury bills) in addition to $1tn USD (in currency) that can be devalued into oblivion (via inflation) by the US federal reserve simply printing a heap more money, has a difference of opinion...

US printing money = they are able to reduce their effective level of debt (in terms of purchasing power) to the rest of the world - without actually paying anything back. They can only do this because they are currently the reserve currency. The Chinese suggestion has merit...

He said that it wasn't sufficient for just the richest countries to use fiscal stimulus to try to bring an end to the recession, but that more countries would need to follow their lead.

Last I heard, the rest of the world wasn't the source of over 45tn USD worth of bad debt...

[Cam]

For those not keen on reading, there's an extremely good episode of PBS Frontline covering the issue.

The short version, again, is that the USA is completely, amazingly and utterly fucked.

FRONTLINE: ten trillion and counting: watch the full program | PBS

Almost an hour long, streaming video, very interesting.

[Pkunk]

Obama (yo mumma) has committed to paying off half the deficit in his term. Think that'll help?

[Jamathi]

Obummar; "I did not make it!"
Hopefully not even to the end his first term.
Americans did get the polly that they deserve, just like the Australians.
Lets start learning chineese, I like the food already now just the lingo!

[dr00]

Obama (yo mumma) has committed to paying off half the deficit in his term. Think that'll help?

it will just be another promise made for short term benefit that he wont fulfill.

[thro]

Obama (yo mumma) has committed to paying off half the deficit in his term. Think that'll help?

How does he propose to do that?

Print up 20tn USD and pay it with that?


You guys know what that will do to the value of the dollar, right?



Because there's fuck all else he can do with all the bailout packages and assorted promises being made...

[Cam]

Obama (yo mumma) has committed to paying off half the deficit in his term. Think that'll help?

Source?

[g0zer]

that frontline show interviews obama staffers regarding their budget projection which shows them running the deficit to over 20 trillion dollars over the course of the next 8 years.

the US deficit is using their trading partners to pay for their wars. where is this extra 10 trillion going to come from?

the unbeatable US military's weakness is that it needs to be funded and that funding is a finite resource.

it is certain that the enemies of the US are aware of this weakness. the strike against the WTC really was a masterstroke. not only did it damage the US economy at the same time it took advantage of the US's belligerant foreign policy to get them to commit to an extended conflict- increasing the drain it places on their economy and the economies of their trading partners.

not only is the worst not over economically, maybe the worst is not over in terms of world conflict either.

[Taylor]

That $20,000,000,000,000 USD doesn't factor in social security and medicare does it? Only the things which they government HAS to repay?

[thro]

^^ correct.

with the baby boomers all retiring and needing health care benefits, a figure i saw quoted was something like 45tn in unfunded obligations under the current government (as of late 2008).


every time the US sells some more T-bills to another country, their dollar value *should* be going down. the fact that its not is simply because of the goodwill (knowingly, or not) of other countries to keep buying them (on the promise that within X years they'll get a return of 10% or whatever - currently those returns are being generated by - you guessed it, printing more t-bills and selling them to other countries - equivalent of paying off your VISA with your mastercard - or using your credit card to make a mortgage payment). eventually, there will come a breaking point. the rumblings out of china about a new reserve currency are an indication that perhaps that breaking point is coming...

[Jamathi]

Well Crudd has been doing the same, stimulating the economy by giving borrowed $$ to his voters.
Who is going to foy for that!

[jules_1972]

Well Crudd has been doing the same, stimulating the economy by giving borrowed $$ to his voters.
Who is going to foy for that!

Yep.....

Worry about our own back yard instead of Obama's.....

[thro]

We at least have the potential to produce stuff to pay for it.

The US economy has farmed all their labour/production facilities/factories out to mexico, china, etc.

The companies owning them have now gone broke; they have no (well, insufficient) local production capacity - and to kick-start this they're going to have to compete with china, mexico, etc on price. Which means extremely low wages for US people doing the manufacturing...

Our debt is *nowhere near* the 30,000usd per man woman and child of our population that they have accrued...

[jules_1972]

We at least have the potential to produce stuff to pay for it.

The US economy has farmed all their labour/production facilities/factories out to mexico, china, etc.

The companies owning them have now gone broke; they have no (well, insufficient) local production capacity - and to kick-start this they're going to have to compete with china, mexico, etc on price. Which means extremely low wages for US people doing the manufacturing...

Our debt is *nowhere near* the 30,000usd per man woman and child of our population that they have accrued...

Yes we have potential to produce, manufacture, become a very wealthy prosperous country. A little like we were on target back in the 1970's.

Why doesnt Australia do it then?

What is our Debt per individual?

[g0zer]

Foreign Debt (Australian Parliamentary Library - Monthly Economic and Social Indicators Feature Article)



based on a GDP (PPP) of $825B USD and population of 21.3M and (foriegn debt/GDP(PPP)) = 0.45 we are in debt (foreign debt only, not including internal/domestic debt) to the tune of $17500USD each.