"growing debt worm, turning a sick economy into a terminal case".

[donsu]

http://www.atimes.com/atimes/Global_Economy/HA11Dj01.html

Of debt, deflation and rotten apples

(this is a VERY long article and I tried to pick the 4 most important paragraphs. if readers think other paragraphs need airing, post them in your replies)

Deflation is a problem that looms over the horizon when the US debt bubble bursts to slow down the economy. Yet investors are motivated to buy US bonds to lock in current high yields if they expect the Federal Reserve, the central bank, to cut short-term rates in the near future to stimulate a slowing economy.

-snip-

This unsustainable bloodletting cure for a sick economy is celebrated by neo-liberal economists as a happy boom from free trade. The trade apple is kept shining on the outside by sucking nutrients for a slowly depleting, rotting core, eaten away by a growing debt worm, turning a sick economy into a terminal case.


-snip-

Thus the concept of a neutral rate, one that is neither above nor below normal spreads over inflation rates, is made useless by practical difficulties. This of course is a standard Greenspan position on all economic concepts as the Wizard of Bubbleland always drives by the seat of his pragmatic pants, doing the opposite of his obscure periodic ideological pronouncements.

-snip-

Offshore dollars not necessarily owned by foreigners
Non-dollar investors in US dollar assets are not necessarily foreigners. They are anyone with non-dollar revenue, such as US transnational companies that sell overseas or mutual funds that invest in non-dollar economies.
-snip-
--------------------------------


and another article on the economy:

http://www.counterpunch.com/roberts01102006.html


Bush's Con Jobs
Will the US Need an IMF Bail Out?


President George W. Bush has destroyed America's economy along with America's reputation as a truthful, compassionate, peace-loving nation that values civil liberties and human rights.

Nobel prize-winning economist Joseph Stiglitz and Harvard University budget expert Linda Bilmes have calculated the cost to Americans of Bush's Iraq war to be between one and two trillion dollars. This figure is 5 to 10 times higher than the $200 billion that Bush's economic adviser, Larry Lindsey, estimated. Lindsey was fired by Bush, because Lindsey's estimate was three times higher than the $70 billion figure that the Bush administration used to mislead Congress and the American voters about the burden of the war. You can't work in the Bush administration unless you are willing to lie for dub-ya.

Americans need to ask themselves if the White House is in competent hands when a $70 billion war becomes a $2 trillion war. Bush sold his war by understating its cost by a factor of 28.57. Any financial officer any where in the world whose project was 2,857 percent over budget would instantly be fired for utter incompetence.

-snip-

Stiglitz correctly includes the cost of lifetime care of the wounded, the economic value of destroyed and lost lives, and the opportunity cost of the resources diverted to war destruction. What he leaves out is the war's diversion of the nation's attention away from the ongoing erosion of the US economy. War and the accompanying domestic police state have filled the attention span of Americans and their government. Meanwhile, the US economy has been rapidly deteriorating into third world status.
-snip-
-------------------------------------------------

we can ignore the economy but the economy sure won't ignore us.

"TERMINAL CASE"

america is doomed.

[xchrom]

1. no, the economy won't ignore us.

the debt won't, the deficit won't, the excessive{?} prices of oil and gas, etc.

but listen to fox or kudlow or kramer etc -- where are americans supposed to find the info that might -- and i mean might , because americans are a peculiarly myopic lot when it come to money and the economy -- shake some sense into them?

i'm a committed leftist for more reasons than the current expedient ones -- sustainable economic growth with strong rights for workers{including white collar folks} are at teh very top of the list.