US credit woes ripple across globe

[babylonsister]

US credit woes ripple across globe
Can the global economy shake off economic weaknesses in the US?
By Mark Trumbull | Staff writer of The Christian Science Monitor

from the July 31, 2007 edition

Page 1 of 2

It's a good thing that the world economy had a head of steam going into this summer, because it now faces financial headwinds made in the USA.

On Monday, shares of the German industrial bank IKB plummeted as the bank announced its earnings would be hit hard by the rising default rate of American subprime home loans.

The news served as a reminder: Politics may be local or national, but the realm of banking and finance is international.

In fact, when concerns about a tighter flow of credit sent stocks tumbling in the United States last week, the phenomenon was really global. Borrowing is becoming more difficult and more expensive worldwide. And stock markets fell as much last week in Europe and developing nations as in the US.

The good news is that these financial tremors come at a time of robust growth in most nations. For American workers that means a healthy demand for exported goods, which helps offset the impact of a deep housing slump.

"The likelihood is that the global economy will move through this OK," says Michael Cosgrove, publisher of the Econoclast, a market newsletter in Dallas. Although credit markets are global, many nations' economies are "not nearly as linked to the US as they once were."

Still, the process of unwinding after years of easy credit is fraught with risks.

more...

http://www.csmonitor.com/2007/0731/p01s04-usec.html

[porphyrian]

1. Just wait. - n/t

[SpiralHawk]

2. "Don't worry, republicon cronies will be just fine." - Republicon Homelander Cronies

"We have boodles of cash squirreled away, and strategeries to profit from the misery of all you little people. Smirk, smirk, smirk."

- Republicon Homelander Cronies

[fasttense]

3. What exactly do we export that will help the American worker?

"For American workers that means a healthy demand for exported goods, which helps offset the impact of a deep housing slump."

Perhaps they mean weapons. That seems to be the only thing the US is selling right now. But having only one successful industry is not going to keep American workers in jobs. We have a service based economy and exchanging services between citizens is the definition of a Banana Republic. Perhaps the bushes refusal to stop the war is due to the fact that the weapon industry is what is keeping the American economy alive right now.

[SpiralHawk]

4. "Weapons are highly profitable. Smirk>" - Republicon Homelander Cronies

"Support our Beloved Homeland (smirk, smirk, smirk), export tons of weapons so all the little brown people around the planet can kill one another, and we 'elites' can make boodles of cash. Smirk."

- Republicon Homelander Cronies

[zabet]

5. There will be 2 extreme Americas then...

The Rich Repugs and the impovershed citizens of the US. The newest 3rd world
country on the globe.