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Strategies & Market Trends : The coming US dollar crisis
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To: Real Man who wrote (20935)6/23/2009 12:06:27 PM
From: Nevada99994 Recommendations  Read Replies (1) of 71456
 
The critical element of the US economy is consumption. The 'recovery' of 2003-2007 was driven by rising home equity which was cashed out to drive consumption. That was not very efficient. The new green shoot recovery is being driven by foreclosure. Once foreclosure takes place and people are evicted from their homes, they no longer have a mortgage to pay and they can direct more income towards consumption. Unemployment is also a critical part of the new economic model. Unemployed people have more time to devote to consumption. As the unemployment rate increases towards 100%, US GDP can move from 70% consumption based towards 100% consumption based. This is what the Chinese want, more western consumption. They have been a key player in driving this economic model. The vision for the future of the US is 100% consumption 24/7. We just need to send Geithner over again to explain this to the Chinese, they seem to be getting a little pessimistic lately.
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