swimmerxc asked:
Since the US economy is pretty much going the drain now, if China chooses now to switch a large amount of their foreign exchange reserves to Euro. What affects will this have on the US economy?
Sabrina
Since the US economy is pretty much going the drain now, if China chooses now to switch a large amount of their foreign exchange reserves to Euro. What affects will this have on the US economy?
Sabrina
GREAT DEPRESSION ||
Comment by CrIcKeE — January 31, 2008 @ 1:02 am
The end of the United States as we know for the rest of our and our childrens lifetimes. That is what the bailout is about actually! If the government doesnt step in to guarantee the debt crisis, foreign investors will lose faith in Americas ability to repay its debt and will rid themslves of the bad risk. If you think 700 Billion is bad, add on to no more foreign investment to support our national debt.
China will lose in the short term and gain in the long term. China is now both the supply and demand side of the economic global equation. The United States is still the largest economy, but this bailout hammers it into a fractured orphan of what it once was.
add on the true cost of the war including four hundred billion in medical costs, death benefits, etc.. and you’ve got a 1.5 trillion lead weight around an economy that doesnt make or produce squat!
In conclusion, i what you are saying were to happen, you would see 30-40% unemployment, a DOW in 8,000 territory, A dollar that has a value you could literally (not joking) wipe your butt-hole with. Everything you buy comes from abroad and is bought in dollars, if it costs 2,000 dollars for a good flat screen and the dollar loses 80% of its value, that television will cost 80% more. ($3,600.00) $10 per gallon gas.. No one drives.. No one buys anything.. No roads get fixed or constructed.. no loans for houses or for business are issued.. we evaporate.. Robert Putnam wrote a book about this once.. It was about how all the superpowers lost their power by overextending on Military.. Rome.. England.. Spain.. Russia..
History repeats itself my friend.. and the USA has no bright spot at the end of the long and dark tunnel.
Comment by Tom — February 2, 2008 @ 7:20 am