from saudigazette........
As to America, Japan and Europe, their decline now seems inevitable. The IMF says that the Chinese economy will overtake America’s by 2016. The US government’s debt has already hit the ceiling of some $14.94 trillion, which is more than its GDP. America’s total public liabilities are mind-bending – around $75 trillion. Can that ever be repaid? Will it? I wouldn’t bet on it. If Congress doesn’t increase the debt ceiling America will default on its next debt servicing payment on Aug. 2, 2011. When such thing happens a country is declared a “failed state”. America’s credit rating has been lowered by its own rating agencies. It gets damaged both ways: raising the debt ceiling signals a deep malaise in the economy; defaulting will cause a run on the dollar and expose the truth that it is fast becoming worthless. The global economy will crash.
European economies are falling like ninepins. The UK’s debt too is more than its GDP with no manufacturing base left. Iceland, Ireland, Portugal have had bailouts. Greece has had to suffer too. Spain and Italy are teetering. Poor Japan, its debt is twice its GDP. The earthquake and tsunami has shaken the Japanese economy to its foundations, putting it beyond full recovery.
When the fall first came in October 2008, IMF chief Dominique Strauss-Kahn warned that the world’s financial system is teetering on the “brink of a systemic meltdown.” But America treated the symptoms, not the disease, for the very banks and bankers who took the US economy to the brink are also the decision-makers. What chance does the patient have when the doctors that gave him a headache are providing only temporary relief with aspirin instead of treating the tumour in the brain?
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