The U.S. debt situation is starting to resemble that of many Third World countries that rang up excessive debt in the 80's and 90's. In return for refinancing to avoid default, they had to adopt austerity measures and get their fiscal houses in order.
Now the G-20 is talking about doing the same with us to prop up the dollar. I am NOT making this up. Wish I was.
The "lamestream" media underreported Chinese concerns about the amount and QUALITY of our debt. Melonie has done her usual superb job of pointing out the problems with rolling over short term U.S. Government debt.
Yesterday, in a barely reported item, several G-20 members expressed concern about the declining dollar. They recognize that the U.S. is a major market for their goods and that the dollar is the reserve currency for the rest of the world. In order to sell us stuff, they have to take dollars in payment. For now. As I noted in another thread, the President of Brazil has joined China and Russia in calling for using native currencies or using a new currency other than the dollar.
Rather than go through the disruptive process of de-dollaring, a number of G-20 countries are quietly talking about bailing out the dollar ( Foreign Aid to the U.S. ! - lol to keep from crying ) in return for BOTH fiscal and monetary discipline from the U.S.
Obama is busy trotting around trying to get China and other big exporters to lessen their dependence on exports and increase domestic spending. In return the U.S. will agree to do what it is supposed to do : increase savings and reduce debt . In a nutshell, many of the G-20 members are politely telling him to copulate with himself. They like being where we were after W.W. I and W.W.II. They like having economic growth of 5 % as Brazil does. They are increasingly interested in making sure that all the money they've lent us gets paid back.
The NERVE of those people !



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I hadn't read through all the posts yet, just the OP.



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