** Private ** wrote: > Judah wrote: >> Its going to be some smart people going to work hard trying to get us >> out of a mess. > > And, if they are smart, they'll conclude we need immediate emergency > government spending on the level of the WWII. Probably $1-3 Trillion > right away.
You are focusing on just one of the underlying problems in the US. In a broader economic context, what the US needs is: - an increase in demand for its products / services (to pick up for the falling domestic consumer demand); - a decrease in consumer spending (consumer savings is still too low in the US); - a decrease in the trade deficit (trade balance is still short about 2 billion per day); - a decrease in government deficit (the government is 'crowding out' other debtors and foreign countries will want more risk premium to continue funding the US debt). So really the only way to attack all of these problems at the same time is to 'export the US out of the crisis'. The typical reaction to a crisis makes that easier: when you are in crisis your currency loses value and your export increases. The problem in the US is that the trade deficit and the dependency on oil have grown so huge that a devaluation of the dollar has a much stronger effect on the inflation then in most other countries. So any devaluation of the dollar will immediately result in an increase in the price of oil that competing countries will feel much less. Due to this negative multiplier effect the change must me much more drastic then other countries in the same circumstances would have had to change. > It may also mean buying into some industries - more than already has > been done. And probably getting a LOT more activist in the daily > operations of business to prevent things like $40B in bonuses going to > execs. > > At the same time we'll need to go global and so it'll require a LOT of > diplomacy. It does require going global, but not by diplomacy but by producing products the rest of the world wants to buy. Jochem ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Adobe® ColdFusion® 8 software 8 is the most important and dramatic release to date Get the Free Trial http://ad.doubleclick.net/clk;207172674;29440083;f Archive: http://www.houseoffusion.com/groups/cf-community/message.cfm/messageid:278273 Subscription: http://www.houseoffusion.com/groups/cf-community/subscribe.cfm Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=11502.10531.5
