Like Europe, U.S. is economically and therefore politically at a crossroads. U.S. faces a painful detoxification drug debt – or are drowned by a rising interest burden and end a hostage to foreign investors. U.S. continue to fight the debt crisis and again by the new debt, could lose the confidence of creditors. The separation of the largest pension funds in the world of all U.S. Treasury bonds are an example of this.
Time is short. Interest rates rise, because the bond buyback program of U.S. government Federal Reserve (Fed) in the summer is over, spend the big investors and have no, or only in increased profitability trends in the dollar or inflation must be countered, then the loop goes around the neck earlier than later to breathing difficulties. Even a scenario that would be the rating of the United States reduced, no longer seem exaggerated.
More than a policy in a year in the U.S., but under the spell of a campaign, probably harder than ever election for the U.S. presidency. The window of time for a fundamental change in U.S. policy economic and financial should include the following spring for almost a year and a half.
Europe has no reason to overcome the problems of the United States. With its internal imbalances, the financial problems of the Member States of the euro zone, an unstable banking system and lack of coordination of economic and fiscal policies, has enough on home renovation needs. If you are willing and able to do your homework comprehensive and sustainable, now the European Council on 24-25. must show in March 2011.
U.S. is trapped in a debt trap and into a dependence on foreign capital, is more troubling. His debt is no later than next year to start around $ 15 billion, the 100 percent mark, compared with the annual economic output. The annual budget deficit ($ 1.5 billion in current budget) is the third time in the sequence between 10 and 11 percent of U.S. gross domestic product. This deficit – funded at relatively low saving U.S. citizens – Unlike in Japan. The savings rate in America has increased following the crisis, but traditionally it was always very low, sometimes below zero. “Buy now, pay later” was the motto of American consumers. The U.S. deficit – the federal deficit and the current account deficit, which reflects the excess of imports and private debt – funded mainly part of foreign investors who see the dollar a safe haven and the United States a reliable debtor. The whole system is based on that.
The number of foreigners – the public and private creditors – U.S. Title is about 11 billion dollars. Of what keeps China (including Hong Kong) is about $ 1.3 trillion of government bonds alone (about 4.4 billion dollars in property creditors around the world.) This enormous financial dependence on foreign investors and China in particular, threatens to escalate at some point in a political dependency. Even if charged, is that the U.S. and China, at least economically symbiotic relationship have been received in which the Chinese are interested in the value of its U.S. plants and its model of growth driven by exports to the huge U.S. market, can have a stable equilibrium point. In its foreign exchange reserves of 2.8 trillion dollars, their margins of alternative investment strategies and their long suffering, calls for a revaluation of its currency to ignore the Chinese are sitting in front of the two “Chimera.”