World Economy

[Minorci]

Is anyone actually following the markets and situation over in America?

Typical news scare mongering with recession, gfc no2. Still it's interesting to see how badly the market has been reacting to the US debt agreement.

Aussie market dropped 25 billion within something like 3 mins of opening.

[psyave]

its because they made an agreement so cut costs... but most analysts believe that without either a tax increase, or better spending within government services they will be back in the same position within 6 months to a year. So in turn its just a scare mongering situation, markets should rebound and we will know the true situation in that time frame.

Gotta remember they are still the number 1 economy, so any damage to them will damage us... and if the reports coming from Spain and Italy that the EU might have to bail out them as well... this could result in more economic craziness of some sort and in some reports, the EU as it stands might fold. This in turn might speed up the decaying US economy and speed up china's ever closing foot steps to been number 1.

Now the interesting thing about this, the US could save trillions by not been at the number 1 spot... the amount of cash they fork out to help other countries from deficit its enormous, if China wants to stay number 1 when they reach it, it will be their cash used to stay in that spot. The scarey thing about this is that who ever has been number 1 sets the precedence between trades, while the usual capitalism we expect from US corporations upon the world on how they set the bench mark rules, it will be interesting what china will do when they are allowed to set the bench mark.

I'd also expect the US dollar to be the marked currency unit across the world for a while after the Chinese take the number 1 spot. Then in-fluxed investment into China will see the yaun(?) become the "world dollar".


So in sum, we wont know until about 6 months to a year on whether we might see a gfc2, for the time been, markets should rebound. In the long term, who knows, apart from the chinese taking over.


"We build for China"

[OverDrive]

U.S. loses AAA credit rating from S&P | Reuters : politics

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[Jay]

Could be worse, they could be Greece.