[Marxism] The Coming U.S. Economic Crisis?

["Pieinsky" <pieinsky@xxxxxxx>]

US$ plunge could lead to full-blown financial crisis
If confidence goes, lenders will pull loans and cause dollar to crash
By William Choong

YEARS before the Asian financial crisis of 1997, many Asian countries had
become hooked on a dangerous concept - credit.

Economic growth was chugging along nicely, and in countries such as
Thailand, the middle-class was indulging in a consumer frenzy, buying
branded goods, holidaying abroad and sending their children to overseas
schools.

But Thailand's trade deficit - the amount by which imports exceed exports -
was growing, financed by massive short-term loans from foreigners.

When investors lost confidence, however, a sudden flight of capital brought
the kingdom to its knees.

The odd thing is, this year, the United States - once the world's biggest
creditor nation - is also experiencing a credit- fuelled consumer spending
spree.

There are fears the American appetite for Japanese cars, Chinese clothing
and Malaysian electronics could cause a global financial crisis sparked by a
run on the US dollar.

This has led to a massive current account deficit of more than US$500
billion (S$850 billion) - a far cry from 10 years ago, when the US enjoyed a
trade surplus of US$82 billion.

More: http://straitstimes.asia1.com.sg/world/story/0,4386,230495,00.html





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