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

To: Maurice Winn who wrote (75221)	6/14/2011 12:39:57 PM
From: carranza2	Respond to of 217580

Mq, I only cited the article for the qu;ite sensible notion that the huge amount of consumer debt in the US will preclude recovery. According to the authors, it hangs over everything, like a buzzard on a tree-limb waiting for a tasty bit. In historical terms, consumer debt is enormous and inflated. The authors sensibly point out that growth is unlikely to happen while the debt hangover is in place inasmuch as the American consumer, the heart of the global economy during the roaring '90s, is on strike. The consumer is trying to pay off debts and therefore will not be contributing to demand. This will have global implications. So long as demand is lagging, housing will lag and employment will lag, too, because corporations cannot employ more workers if demand for their products is not what it used to be. The stimuli and QEs did not give consumer demand the necessary impetus. It did give us more government debt, though, an unanticipated but thoroughly negative result. Getting the US economy back on track will require that the consumer feel confident that things are getting better so that he can safely incur debt. He is not there yet, and won't be for a very long time inasmuch as a credit bust typically takes years to resolve. The policy towards the USD is helping a bit because payment in devalued dollars hurries up the payment of debt.