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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (14650)	2/22/2007 3:19:47 PM
From: THE ANT	Read Replies (1) \| Respond to of 217591

Did you mean to compare China and the USA?

To: Elroy Jetson who wrote (14650)	2/22/2007 8:39:00 PM
From: elmatador	Read Replies (1) \| Respond to of 217591

China household savings rate is 16% of GDP. This is not abnormally high. Overall rate to such a huge 50% of annual GDP is by companies and the state. Not by people. State firms do not pay dividends, the high profits of recent years pushed up their savings. Government savings is also unusually high. Louis Kuijs (World Bank). When you hear the world imbalance, means emerging markets with money and rich countries without it. The subsidiation of rich economies is not sustainable. Those who argue that the poor countries will continue to finance Ameica’s current account deficit long into the future seem to forget one day it will have to pay back the money. Asia’s central banks have turned off the usual market signal of rising bond yelds which should be telling America to put its house in order. As long as America can get cheap money from abroad, it has little incentive to rebalance its economy. When the imbalances unwound, the process will hurt even more. Unless America reduces its deficit before emerging markets lose interest in accumulating reserves, the dollar, treasurt bonds and the whole American economy are likely to suffer a hard land. Brazil has acumulated 100 billion and this is not good. We should not do so, because doing that we are not helping the US to put its house in order. Stop looking to the poor countries. Look to the US. That’s where the problem lies.