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Most believe that a recovery will always follow a recession. But what if this time it won't. What if this recession announces a permanent decline of the US economy?

omega4(omega)

At least for industrial states like Michigan, Ohio, Penn, Wisconsin, the jobs and factories they lost will never comeback. The US economic problem is mainly caused by its mountains of trade and budget deficts, this problem is structural, long term and unsolvable. The US government has tried everything they can, cutting rates, cutting taxes, giving money to families, but these won't help much because most products sold in the US are produced in other countries. So even if Americans receive a bit money from their goverment, they will spend it on buying made-in-china cheap stuffs after paying some of their debts

(#4317902@0)
Last Updated: 2008-3-8

Replies, comments and Discussions:

工作学习 / 事业与工作 / Age of turbulence 第4集：多米诺效应 (Ripple Effect) -zuluking(Pursuit of Happyness); 2008-3-8 {1052} (#4317703@0)

Nice articles! -moonnew(moonnew); 2008-3-8 (#4317827@0)
Minor correction: municipalities = 市级政府，not communities (社区） -newtorontonian(n); 2008-3-8 (#4317858@0)

主要应该是指Muni Bond吧 -newtorontonian(n); 2008-3-8 (#4317904@0)

Muni rallied in US market in the past few days and reached historical level, PIMCO 大量收购，看来Bill Gross 还是够厉害，知道什么时候买什么东西。 -zuluking(Pursuit of Happyness); 2008-3-8 (#4318322@0)

Most believe that a recovery will always follow a recession. But what if this time it won't. What if this recession announces a permanent decline of the US economy? -omega4(omega); 2008-3-8 {619} (#4317902@0)
At least for industrial states like Michigan, Ohio, Penn, Wisconsin, the jobs and factories they lost will never comeback. The US economic problem is mainly caused by its mountains of trade and budget deficts, this problem is structural, long term and unsolvable. The US government has tried everything they can, cutting rates, cutting taxes, giving money to families, but these won't help much because most products sold in the US are produced in other countries. So even if Americans receive a bit money from their goverment, they will spend it on buying made-in-china cheap stuffs after paying some of their debts

70% of US long term Treasury Bonds in the past several years were bought by Chinese government. -newtorontonian(n); 2008-3-8 {178} (#4317918@0)
So if US is in trouble, China, and most of the world will too. It is not only US's problem thanks to the globalization. Labor market and capital market diversified in both ways.

Not only that, the Chinese exports to the US will be hit hard by a US recession. That's why China is considering using its huge foreign reserves to help save the US financial market. -omega4(omega); 2008-3-8 {120} (#4317947@0)
But that runs a huge political risk, its investments in US financial houses like Blackstone have already lost big money.

hi, 能说说美国次贷危机对加拿大mortgage company 的影响吗? -linsay08(Back to Board); 2008-3-8 (#4318254@0)
这次的global credit crunch 对 M&A market和LBO的影响应该很大吧。 -specialday(Joyce); 2008-3-8 (#4318414@0)

@Edmonton

Most believe that a recovery will always follow a recession. But what if this time it won't. What if this recession announces a permanent decline of the US economy?

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