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By Ed Henry
Since Thanksgiving week, at least six articles have appeared to talk about the falling dollar and what it means to the United States and the world. Most of these have been very negative.
The one article that held hope was published by the New York Times called When Weakness is a Strength written by Stephen S. Roach, the chief economist for Morgan Stanley. This article laid out four points that, if handled properly, could bring the world economy to a soft balanced landing that would be good for the United States.
Trouble is, the Boston Herald published an article titled Economic Armageddon predicted that accused the same Mr. Stephen Roach of telling his friends and cohorts something entirely different. In a speech to a group at Fidelity, his prediction was that "America has no better than a 10 percent chance of avoiding economic ‘Armageddon.’”
In an article titled What The Dollar’s Collapse Will Mean To The World, Rense.com had the harshest things to say: “There is nothing the USA can do to prevent the collapse of its currency, and its economy. It has no reserves to support its value, and has the most indebted country in the world, is dependant on the credit from America's former enemies. Over the last couple of days, both Russia and China have said they will be switching their considerable dollar reserves into Euros. This will only hasten the lack of confidence in the dollar, creating a global lack of confidence in the currency, and setting the dollar into free-fall. The collapse of the dollar will throw the world into a global depression. Those nations with large external debts will not be able to trade sufficiently to earn the income to service their debts, and will slide into bankruptcy. The economies of New Zealand , Australia , Canada and the UK will also totally collapse as a result of their indebtedness and not being able to service their borrowings. It will result in the Anglo-Saxon nations facing abject poverty, our people facing starvation, and a total break-down in society. Crime will become rampant. Law and order will cease to exist. Disease will become widespread.”
On November 27th, the New York Times published another article called Foreign Interest Appears to Flag as Dollar Falls while Truthout.com published a translation from the French Liberation that claimed France was in a fairly good position “with a positive 7% of its income” and even the World Socialist Web Site published an article titled US dollar continues to slide.
Besides the obvious sliding value of the dollar, each of these articles seems to point out the fact that the authors and foreigners understand the indebtedness of America better than do the American people. Not only have the borrowholics of government run up the national debt to the point that it’s pushing the Gross Domestic Product ($95 billion so far this month as of Friday, November 26th), but the American people are individually up to their eyeballs in debt, together consuming more than eighty percent of the world’s savings. This simply cannot go on indefinitely.
Glossing over the job situation, industries going offshore, open borders, and other elements of the economy, foreign nations may understand all too well that it’s the American taxpayer who stands behind every one of the US Treasury’s securities – that there’s no one else to make good on the investments they’ve made.
Most importantly, just what do you think will happen when these foreign lenders realize that the American government has been cheating its own people? The very same people who must come up with the cash to pay off the securities these countries have invested in. The very same people who have buried their heads in the sand, done nothing about a scam that rips off their supplemental retirement insurance money, spends it on invasions and frivolous things, maintains more than 725 military bases in 70 percent of the world, has little to sell but weapons of mass destruction, and then runs off charging willy-nilly more debt to their credit cards.
The way most of the world feels about our senseless invasion of Iraq and the genocide involved is enough, by itself, to make them pull the rug out from under us.
To top it off, the Washington Post published, on November 29th, an article titled Bush to Change Economic Team which every American citizen should read because it is not dealing with corrective measures, but instead, Bush is surrounding himself with loyal people who subscribe to his cockamamie plans to reform Social Security and develop a greater tax base with something like consumption taxes.
I’m sorry, but I’ve been trying to warn you of these factors for years. Now it may be too late to do anything sensible about it.
"Published originally at EtherZone.com: republication allowed with this notice and hyperlink intact."
Ed Henry is the founder of TUFF, the Taxpayers Union, and a regular columnist for Ether Zone. Ed's new book, "Rip Off" is now available... check it out here!. We also invite you to visit his website.
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