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laodan discovered 2 months ago- What is left that is sellable? in Asia Times by Doug Noland
It was a bubble of historic proportions and it's all laid out on the L.107 page in the Fed's Z.1 report. ... For the year (2007), total credit (non-financial and financial) expanded a record $3.998 trillion (8.9%) to $48.808 trillion. This was a moderate increase from 2006's growth of $3.859 trillion (9.4%), and compares to 2005's $3.310 trillion, 2004's $3.178 trillion, 2003's $2.779 trillion, 2002's $2.781 trillion, 2001's $2.020 trillion, and 2000's $1.679 trillion. Total credit market debt averaged $2.500 trillion annual growth over the 10-year period 1997 to 2006. ... ROW holdings (Rest Of World) of US financial assets were up an astounding $7.222 trillion, or 88%, in just four years ... Somehow, everyone wanted to make believe that we would always enjoy the luxury of trading endless new securities for imported energy, commodities, capital equipment, cheap electronics, and all the consumer goods we could ever dream of. The problem was that our credit system was issuing ever larger quantities of increasingly suspect financial claims ... Well, the entire world has become aware of our situation and will be less than keen to accumulate more of our debt. What is left that is sellable? The Face-Slap Theory in the NYT, a difficult recognition, by PAUL KRUGMAN Going Going. . . . in Clusterfuck Nation by Jim Kunstler Sorry; again a post about economics and finance. I would rather write about another subject but this is unfortunately what dominates our present. "Total credit market debt averaged $2.500 trillion annual growth over the 10-year period 1997 to 2006. " This means that on average the US economy needed, in each of these last 10 years, to borrow the equivalent of 20-25% of its annual GDP to retain its way of life and its status as n#1 economic power on earth. Today when papers, representing the US total debt of $48.808 trillion, come to market they most often don't find buyers any longer. That means that financial investors have lost trust in paper and the value of paper goes down meaning that the present assets of US citizens and enterprises are fast melting away. That also means that the US will no longer be able to find buyers for new debt paper and in consequence it will not be able to sustain its way of life and its status as n#1 economic and military power on earth. The financial Armageddon that we are witnessing is reassessing the value of currencies and also the size of national economies. From the present financial swing will emerge a very different world where the relative size of the US will have shrunk drastically. Meanwhile the EU, India, and particularly China will grow as the new dominating centers of world power. And there is a huge risk that in this changing economic and political context the side-effects of modernity will lose people's attention forced as they will be to struggle for survival.
- What is left that is sellable? in Asia Times by Doug Noland
