Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (68935)	10/11/1999 11:32:00 AM
From: Knighty Tin	Respond to of 132070

Les, and nearly half of GDP growth, more like 2/3 last quarter, is chained dollar computer sales, which are just a fantasy.

To: Les H who wrote (68935)	10/13/1999 10:32:00 AM
From: geewiz	Read Replies (1) \| Respond to of 132070

Les, Here is a European view on the same topic "the miricle" ft.com For Private use: 9/29/99 Financial Times; US ECONOMY: A miraculous error; Martin Wolf Intriguingly, the US had started to record annualised growth rates of 5 per cent in domestic demand at the beginning of 1997, before the Asian storm was even a cloud on the horizon. New economy or not, the US is demonstrably unable to sustain growth at this rate. Yet, as it happens, this was a miraculously benign error by the Federal Reserve, one that offset the still more unexpected collapse of demand elsewhere. If the US was the bulwark, is the protection it provides secure? This breaks down into two further questions: how likely is a sharp reversal in US performance and how well could the rest of the world cope? Unhappily, behind the growth of US domestic demand lies behaviour that would, in any other economy, provoke serious concern. Even after their recent correction, equities are, in aggregate, extraordinarily highly valued. Ratios of private sector debt to gross domestic product are also higher than during the last recession. The private sector's financial deficit is expected to be more than 5 per cent of GDP this year (see chart), a level that preceded deep recessions in the UK and the Scandinavian countries at the end of the 1980s. Monetary growth also continues to be strong, with broad money expanding 8 per cent over the year to August. Unemployment, at 4.2 per cent of the labour force,is below rates that would have been considered consistent with stable inflation, until very recently. Inflation has been kept down, temporarily, by weak commodity prices, by global excess capacity for many manufactured goods and by a high real exchange rate. Growth of domestic demand has also spilled over into the current account, which has deteriorated from a deficit of less than 2 per cent of GDP in 1997 to a forecast of 3.5 per cent this year, virtually the same as in the mid-1980s. Economics is no exact science. But, taken together, these facts spell trouble. Each and every one can be explained away. But the vulnerabilities - to a rise in inflation, to a fall in the dollar, to a collapse in equity markets - are also self-evident. later, art