Is the US economy about to collapse?
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By Julian Beltrame, The Canadian Press
OTTAWA - North American markets roiled and the Canadian dollar tumbled Monday in the wake of the sale of New York investment bank Bear Stearns for a fraction of its former value, with some economists tentatively drawing comparison to the 1929 stock market crash.
The volatility began overseas after the U.S. Federal Reserve held an emergency meeting on Sunday and cut its key rate by one-quarter of a point and said it was willing to back-stop institutions with urgent loans.
In Canada, banking stocks took it on the chin as concerns spread about their level of exposure to the U.S. subprime fiasco, with the sector dropping 2.8 per cent in early afternoon trading, and the Canadian Imperial Bank of Commerce (TSX: CM.TO) stock tumbled nearly five per cent.
http://ca.news.finance.yahoo.com/s/17032...
Is the US economy about to collapse?We are witnessing it before our eyes. We are in worse shape then in any of the previous economic downturns, including the Great Depression, because we have an all-time-record national debt, we are continuing to add to that debt with record budget deficits, we have record levels of personal debt, and we are borrowing record amounts from abroad. These countries abroad are tired of keeping our economy afloat. We have reached the point where we cannot borrow any more, and we can't pay back what we owe. The country is essentially at the point where it must declare bankruptcy. We are in much worse shape then during the Carter Administration. Sure, we had double-digit inflation, but we had a very low national debt. That debt started to skyrocket during and after the Reagan Administration. We were able to pull ourselves out of the Great Depression with deficit spending in order to finance public works, and infrastructure projects, but we wont have that option, because we wont be able to borrow any money. Also, the cost of fuel and food is going to become a problem because of increase in global demand, and, apparently, declining supplies of fuel. Global oil production has probably already peaked, and is on its way down. Food production, and delivery is entirely dependent on oil. There is no way we are going to just pull ourselves out of this one. There is going to be a lot of suffering. That is the unfortunate truth. Hopefully, we will regain our sense of what is really important in life. Not money, not things, not going through life without a care in the world, except how to get around that butt who is only going 5 miles over the speed limit, and is in our way, while we'[re headed to the mall. I'm not religious, but, God save our souls!
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