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To: GST who wrote (123284)	4/9/2001 4:48:43 PM
From: Wayners	Read Replies (1) \| Respond to of 164684

I haven't looked at any recent charts of the U.S. International Balance of Payment Accounts. Increased import oil prices certainly don't help the current account deficit. I think that savings and investment are going to be important to keep productivity high so that when we get back to growth, its growth without inflation. If our workers are at least as productive or more productive than our foreign competitors, that should keep people invested in the U.S. Right now we're seeing a global slowdown so I don't see why anybody would yank dollars out of the U.S. to patriate it elsewhere that is going to have the same problems. I think my biggest concern is that we'll see technology companies reduce their investment in R&D spending which would lead to slowing productivity growth and possibly make our products and services that rely on such technology less competitive overseas. I'm not sure what level of balance of payment deficits are needed in the current free floating currency environment. When the U.S. was on the Gold standard you could predict when the U.S. would have to go off the gold standard because the amount of the deficit was three times the amount of our gold reserves (in 1971). At what point do people lose faith in the dollar? There's probably a number of factors that could contribute to such a scenario in conjunction with the deficit. Usually chronic deficits are indicative of inflation and lower productivity than the rest of the industrilized nations. I can't really explain today's deficit. It can't all be oil related.

To: GST who wrote (123284)	4/9/2001 9:26:06 PM
From: Victor Lazlo	Read Replies (1) \| Respond to of 164684

<< I responded that the savings rate needs to be considered an issue as well. >> GST, you have failed to repsond adaquately to my demonstration that your definition of "savings" is completely invalid and antiquated in a dynamic, growing America that allows people from humble bginnings to pour all their energy and resources into a vennture and to build it into a 500 million dollar enterprise. Or to work at a good job for years and build up home equity, college savings for the kids, and a retirment 401k plan. Your definitiion of "savings" conveniently ignores all these. Japan does not allow this. France does not allow this. Germany cannot handle this. Want to work for the Government in any of these countries?? Contribute to a bankrupt govt pension plan?? Sure!! Come on in!! How many American entrepenuers do you see leaving the US to start a thriving business in Japan, France, Gernany or China? Not many!! Japan does not want you there if you are not Japanese !! Admit the truth!! What I see are a lot of highly talented engineers and software and telecom folks and biotech experts from all over the world immigrating to the US with their families to work and discover and build new things in a place where they will get funded, and get left alone (relatively speaking). Your "savings" measurement does not include small family businesses that are a huge part of the US GDP. Your "savings" measurement does not include home equity. Your "savings" measurement does not include small businesses that have grown beyond the family into privately-held 10 or 20 million dollar enterprises with majority stake still held by a family. Your "savings" measurement does not include IRA or 401K savings. (That is about 39% of my household's net worth. And yes, it IS savings.) Your "savings" measurement does not include stock holdings. Your "savings" measurement does not include mutual fund holdings. Your "savings" measurement does not include state-sponsored college savings plans, which have become very popular. Your persistent reliance on some arcane measure of "savings" by people in the U.S. is not valid. Therefore, your whole argument needs a new foundation, if one can be found. GST, let's get with the realities of America and the world in the 21st century here....and stop comparing grapes to coconuts. Anyone with any empirical capabilites at all knows your arguments on this are highly flawed. And you stick to these flawed arguments. c'mon get real!! Victor