The bulls will tell you that foreign governments understand the American economy is the key to global economic health, and that they'll suck it up and take it when we devalue their debt. To which Schiff offers another analogy. Imagine if five people were washed up on a desert island: four Asians and an American. In splitting up their duties, one Asian says he'll fish; another will hunt, another will look for firewood, and another will cook. The American assigns himself the job of eating.
"The modern economist looks at this situation and says the American is key to the whole thing," says Schiff. "Because without him to eat, the four Asians would be unemployed."
Tuesday, October 30, 2007
5 catastrophe scenarios for the US economy
New York magazine has a pretty dire reading of how the US economy could go down in flames. People will call it a black swan when it happens, but it's anything but. The funniest bit is this:
Posted by Nils at 10/30/2007 11:53:00 AM