Originally posted by tide88
reply to post by WISHADOW
The funny thing is you all think this is an american problem. Europe may be worse off then the US. It just hasnt hit as hard there YET. BTW the USA will be fine. Also only 25% of the total debt is owned by foreign contries. And yes by gross external debt we rank number 1. However look at this chart. UK percentage of external debt is a whopping 376% or 189,855$ per capita. Germany 159%, France 211%. There are also many other contries on the list way worse off then the USA. The Debt we have is large, but we are far away from having to declare bankruptcy. And even if we did, you have to be crazy if you think we would just give up our land. I dont care what is says on a piece of paper. I would like to see someone try to come and claim that land or people. It would be an all out war and probably the end of the world. BTW if we are using our land or anything else as collateral, they would just hold a lean on those items. They wouldnt actually have ownership until default.
lending agreements, collateral is a borrower's pledge of specific property to a lender, to secure repayment of a loan. [1][2] The collateral serves as protection for a lender against a borrower's risk of default - that is, any borrower failing to pay the principal and interest under the terms of a loan obligation. If a borrower does default on a loan (due to insolvency or other event), that borrower forfeits (gives up) the property pledged as collateral - and the lender then becomes the owner of the collateral
[edit on 14-2-2009 by tide88]
Oh man! You need a reality check!
I'm sorry to say that in a near future the rest of the world could decouple itself from the US economy and this reform would initially strike very hard on the EU & Asian economies. But you could see the death dance of the American Dollar & hyperinflation my friend.
And let’s be clear about the fact that neither Europe nor Asia have a negative saving rate, a full-scale housing crisis throwing millions of citizens out of their homes, abysmal public and trade deficits, and soon a free-falling currency - therefore they will bounce back faster while the US economy will be locked down further because of it.
Furthermore! Now the US politicians want to quick start the securization market by throwing trillions in to a system that is the cause of the problem.
Basic studies of economy will tell you that this is a insane move in your situation. You don't want to go further down in decline by spending trillions more on getting more debt on personal & individual consumerism.
The only way for the US to avoid an imminent crash would be to show the markets and the world, investments & lending to companies of manufactureing and produce something of real value.
If you'll continue throwing money down the drain on personal consuming, the world will not lend you anymore money - that is a fact!
At the G7 meeting in Rome the US understood that the days of US dollar hegemony could soon be over when the long needed reform of the financial system take place. A new Bretton Wood agreement could be waiting behind the curtains my friend?!
There is no time for ignorance & national arrogance against the rest of the world.
The only way you can have a chance in hell to reverse what's coming, would be to immedietly start building a manufacturing base and give loans to new start-up factories & companies and start producing something of value to export to the world. This mean you have to devalue the dollar 60-70% initially to get the wheels moving and also have a period of low wages paid to workers of your new factories.
A few new technology breakthroughs coming to the market from the US could also speed up the process of a very slow recovery.
Hard times for all - good luck friend!
[edi
[edit on 15-2-2009 by Chevalerous]







