Instead a conventional war, in which the technology and the economy are to support the military, it goes the other way around. The technology and the military are to support the economic war. I'm sure there will be military sabre rattling but it won't be a great war like world war 2. Maybe there will be a smaller war, smaller than the Iraq war, but it would be part of the main goal, economic victory.

Since the world is experiencing globalization, there will be no such thing like total decoupling. So, it'll be interesting to see how are they going to try to dominate their enemies without hurting themselves.

Just like the old war, it is the war of two powers, the old economic regime and the new economic regime. And just like the old war, the winner of this war will determine the direction of the world economy for the century.

Either the war has already started or it's just about to begin.

Hey, it's better than the alternative.

[edit on Mon, 28 Jan 08 by Jazzyguy]

The only real problem with this, is the fact that it's not a strategic battle. It's a tactical one, where victory is defined merely by survival. This isn't a a gran d imperial economic war, where any of the sides has an arsenal of weapons.

This is a Global Catastrophe, where nationalistic greed will be the key factor.

For example, the fed dut rates the other day, but why?

In the past, you would cut rates to stimulate lending, and subsequently growth. The problem is that lending itself is in trouble, so cutting rates is like drinking more coffee after you have already been strung out on coffee, it's not going to help at all. And in fact will make it worse.

So why did this happen? If the consumers aren't going to be getting loands, then what good does this do?

The first is simple "Conditioned Reaction", any time the fed cuts rates, stocks rally for a bit. It's pavlovian, even though the rate cut is now meaniningless given how it's worked in the past.

However, whats really scary about this rate cut, is that it made money available to US banks at a cheaper rate, so that they could in turn lend that money to foreign banks, like Societe General. It was this rogue trader which caused SocGen to lose 7.5 B USD, and because of that they had to borrow the money from American banks to make up for it.

This is a crazy new world we are living in.

I believe we are in the middle of this economic world war, and it might get full blown with china's push for a new world currency order.

Who do you think is winning, US (the old power), or china (the newbie)?
I personally don't think china has real power to challenge US, not even in the current state that the US is in.