Where is the US economy headed?

Ragman wrote:

CI: you said "If one is diversified and thinks long-term, all should work out well. "

While I definitely agree with you on that philosophy for my investment direction. I don't agree with you regarding the avg US consumer/investor.
It has been shown that US consumer is not diversified enough and has no clue about long term. In fact the consumer is more of a short-term thinker than ever. Hence bad loans ... deep debt and record low savings rate.

Ahh..a race for new conservation new technology - that is where the R&D race should be...a way to save energy..reneweable source..low carbon footprint... and beat the other countries to the punch. What are the odds of this happening here?

If you could just convince the vast number of right-wing voters of the immense profit involved with being a world-wide leader in this technology, the odds would skyrocket.

Cycloptichorn

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AHH..there's the rub!

Would have more luck with herding a clowder of cats

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I give recession a better than 50/50 chance next year.

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C I
I also subscribe with your above views.

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Ramafuchs wrote:

C I
I also subscribe with your above views.

i don't , I must be evil.

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Shockwave from credit crisis continues to spread

Financial Times
Published: December 10, 2007, 23:21

As the credit crisis deepens, at least one big question has been answered. We now have abundant evidence that the crisis is affecting the real economy. So we need to switch our attention from the travails of the banks and look instead at their customers. Which of them are getting hit?

The benign response comes from the global economics team at Merrill Lynch. Granted, they say, US mortgage borrowers are suffering and their UK counterparts will be shortly.

But in the euro zone, consumers are less heavily indebted. And credit creation in the euro zone, on the latest October figures, is still showing strong double-digit growth. Hence the fact that the European Central Bank did not cut interest rates last week.
http://archive.gulfnews.com/articles/07/12/11/10173855.html

Meanwhile, the corporate world is no longer going gang busters. The Times continues.

Corporate profits, which had held up well through most of the decade, are showing signs of retreat, and some economists say that capital spending on new machines and equipment might also be weakening. Job growth has clearly weakened in the last two years, but not drastically. Employers added 127,100 a month, on average, over the last year, despite the tight credit market, and the unemployment rate held below 5 percent.

"A mild recession is now likely, with no growth for the year ahead," Richard Berner, chief domestic economist at Morgan Stanley, declared in a report to clients this week.
http://www.newsdissector.com/blog/

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PREMEDITATED MERGER
Billionaire to Canada: Time for amero is now
Wants euro-style currency to avoid exchange problems
Posted: November 27, 2007
1:00 a.m. Eastern

Stephen Jarislowsky, a billionaire money manager and investor the Canadian newspaper Globe and Mail bills as the Canadian Warren Buffet, has told a parliamentary committee Canada and the United States both should abandon their national dollar currencies and move to a regional North American currency as soon as possible.

"I think we have to really seriously start thinking of the model of a continental currency just like Europe," Jarislowsky told the Canadian House of Commons' finance committee, according to the Globe and Mail in Toronto.

Jarislowsky insisted Canada was going to be forced to do something because the increased value of the Canadian dollar vis-à-vis the U.S. dollar was likely to depress business activity in Canada and cause a recession.

"Two-thirds of the Canadian economy is tied to the U.S. economy," Jarislowsky pointed out. "Some 85 percent of our exports are headed for the U.S. market. Our economy is tied to the U.S. dollar, whether we like it or not."

"We don't have a single mill in Canada which isn't losing cash at the current exchange rate despite the fact we invested hundreds of millions in dollars into new equipment when we had the money," Jarislowsky said.

"I believe that if we stay at the present levels, the entire forest products industry practically is going to be in liquidation-bankruptcy and there's going to be an enormous loss of employment," he continued.
Jarislowsky insisted he made very seriously the suggestion to create a euro-style currency for North America.

"Pretty soon, the Finance Ministry will have no choice but to create a new currency," Jarislowsky argued, "unless the Canadian dollar all of a sudden changes course and reverses against the U.S. dollar all on its own."
http://www.wnd.com/news/article.asp?ARTICLE_ID=58877

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Ramafuchs wrote:

PREMEDITATED MERGER
Billionaire to Canada: Time for amero is now
Wants euro-style currency to avoid exchange problems
Posted: November 27, 2007
1:00 a.m. Eastern

Stephen Jarislowsky, a billionaire money manager and investor the Canadian newspaper Globe and Mail bills as the Canadian Warren Buffet, has told a parliamentary committee Canada and the United States both should abandon their national dollar currencies and move to a regional North American currency as soon as possible.

"I think we have to really seriously start thinking of the model of a continental currency just like Europe," Jarislowsky told the Canadian House of Commons' finance committee, according to the Globe and Mail in Toronto.

Jarislowsky insisted Canada was going to be forced to do something because the increased value of the Canadian dollar vis-à-vis the U.S. dollar was likely to depress business activity in Canada and cause a recession.

"Two-thirds of the Canadian economy is tied to the U.S. economy," Jarislowsky pointed out. "Some 85 percent of our exports are headed for the U.S. market. Our economy is tied to the U.S. dollar, whether we like it or not."

"We don't have a single mill in Canada which isn't losing cash at the current exchange rate despite the fact we invested hundreds of millions in dollars into new equipment when we had the money," Jarislowsky said.

"I believe that if we stay at the present levels, the entire forest products industry practically is going to be in liquidation-bankruptcy and there's going to be an enormous loss of employment," he continued.
Jarislowsky insisted he made very seriously the suggestion to create a euro-style currency for North America.

"Pretty soon, the Finance Ministry will have no choice but to create a new currency," Jarislowsky argued, "unless the Canadian dollar all of a sudden changes course and reverses against the U.S. dollar all on its own."
http://www.wnd.com/news/article.asp?ARTICLE_ID=58877

I would fight this to my dying day.

Cycloptichorn

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Cyclo
"Winner takes it all "
is not only Abba's song but reality.
Wish you all the best to win your battle.

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A new North America currency is not going to happen - during my lifetime.

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C I
As a German citizen I also thought that the ex-German currency is strong to survive.
But now I have Euro.
Let us watch the currency developments with rapt attention.

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Rama, You watch; I'll use my time in other ways. Rolling Eyes

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C I
someone had said this( sorry I had forgotten the name of the author)
Borrow golden hours and bestow them on books.

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C I .
here are some valid quotes.

If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks...will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered.... The issuing power should be taken from the banks and restored to the people, to whom it properly belongs. -Thomas Jefferson

History records that the money changers have used every form of abuse, intrigue, deceit, and violent means possible to maintain their control over governments by controlling money and its issuance. -James Madison

If congress has the right under the Constitution to issue paper money, it was given them to use themselves, not to be delegated to individuals or corporations. -Andrew Jackson

The Government should create, issue, and circulate all the currency and credits needed to satisfy the spending power of the Government and the buying power of consumers. By the adoption of these principles, the taxpayers will be saved immense sums of interest. Money will cease to be master and become the servant of humanity. -Abraham Lincoln

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C I
Excuse me please. The following quote is still relevant.

I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men. -Woodrow Wilson

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Rama, You must have noticed some changes since Woodrow Wilson's time; this world doesn't resemble how it looked and operated over half a century ago.

The industries of today has none of the characteristics when Wilson was proclaiming his wisdoms.

The US dollar is the most active and traded currency in the world today. Quite amazing when one considers we represent only five percent of the world population.

The economy of the US is quite resilient compared to all others. The weaker dollar helps us more than it hurts us; but we must cut back on mortgaging our future. High federal and consumer debts bodes poorly for our economic future. It was wrong for the feds to drop short-term rates this week. They have only increased bad habits to continue.

We will suffer a recession next year; how bad is anyone's guess. I think it'll be relatively mild.

The earth will not stop spinning just yet.

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C I
My posts are very critical to warn .
Warning and critical posts are not congenial for consumption.
I will die with a bewitching smile and without regrets.
As a person who uphold decency, democracy and decorum in public life around the globe, i beg to say this.
Painting rosy picture is fine .
Reality is not fantacy nor an unfulfilled DREAM.

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Cycloptichorn wrote:

I would fight this to my dying day.

Cycloptichorn

I'm honestly curious why?

I'm ignorant to the impacts that this may have (if any).

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I agree, maporsche. I don't understand Cyclops' fighting words.
I think that we can agree that this notion will not happen in CI's lifetime or in my lifetime or in Cyclops' lifetime.
What would be the problem with having a North American currency to eliminate the vagaries involved with trade with Canada, one of our biggest trading partners?

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Where is the US economy headed?

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