A Bananna Republic?

Discussion in 'Economy' started by jreeves, Aug 19, 2009.

  1. jreeves
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    jreeves Senior Member

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    Azerbaijan Business Center
    Baku, Fineko/abc.az. Warren Buffett, legendary creator of Berkshire Hathaway Inc., expressed his anxiety over turning the USA into the “banana republic” and called upon the congress to restrict increase of deficit of the budget to gross domestic product (GDP) of the country.

    W. Buffett called upon the US authorities to draw attention on side effects of monetary medicine, which on degree of influence do not cede the crisis.

    “Uncontrolled emission of carbon dioxide leads to melting ice and uncontrolled emission of dollar undermines purchasing ability of currency. The fate of dollar is in hands of the congress,” W. Buffett said.

    In his opinion, billionth money inflows held the largest economics in the world on the verge of disaster, but they could cause damage to it.

    “We have been doing this for a reason I resoundingly applaud.

    Last fall, our financial system stood on the brink of a collapse. The Bush and Obama administrations did the best, although the errors turned out to be inevitable in so difficult situation. The fountain of “federal money” played the considerable role in the saving.

    “The United States economy is now appears to be on a slow path to recovery. But enormous dosages of monetary medicine continue to be administered and, before long, we will need to deal with their side effects. For now, most of those effects are invisible and could indeed remain latent for a long time. Still, their threat may be as ominous as that posed by the financial crisis itself,” W. Buffett said.

    “This fiscal year, though, the deficit will rise to about 13 percent of G.D.P (approx.$1.8 trillion) .. Our country’s “net debt” increases by1% per month, reaching 56% grade from G.D.P. inflation will result in impoverishment of the US citizens, the dollar will keep on losing purchasing ability,” W. Buffett said.

    Hmmm....Obama you still want to spend a trillion dollars on government ran health care?
     
  2. jreeves
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    jreeves Senior Member

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    No liberal responses? crickets....chirp...chirp
     
  3. Old Rocks
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    Old Rocks Diamond Member

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    Hmmm......... Looks like Europe and Japan are also pulling out of the recession. And they already have health care for all of their citizens. Some even have free education for those that can pass the exams. Are they so much smarter that us that they can afford this and we cannot?
     
  4. jreeves
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    jreeves Senior Member

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    Europe and Japan, isn't going to have a deficit of 1.8 trillion dollars this year either.


    Japan's External Deficit Is Worst On Record - Forbes.com
    The country registered a January current account deficit of 172.8 billion yen ($1.8 billion), the Ministry of Finance reported Monday. That was the poorest showing ever for the world’s second-largest economy, a trade behemoth.


    Britain's budget deficit hits new record | Business | guardian.co.uk

    Britain's budget deficit soared to a record high last month, date released this morning shows, threatening to leave the government's budget calculations in tatters.

    The Office for National Statistics reported that public sector net borrowing reached £8.991bn in February, the highest figure for any February since records began in 1993.

    This pushed the total PSNB figure for the year to March 2009 to £75.2bn - another record.

    Alistair Darling had budgeted for a total borrowing of £78bn, but economists believe the final figure could be as high as £88bn as the government typically borrows heavily in March.


    The British deficit coverts into about 45.2 billion dollars.........
     
  5. Toro
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    Toro Diamond Member

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    Japan's debt to GDP is about 175%. Italy is 125%. Right now, America is about 70% (and climbing). Several OECD countries have a higher debt to GDP ratio than the US. It was also much higher at the end of WWII than it is today.

    [​IMG]

    Of course, that doesn't mean we should just jack up the debt because others are more indebted or because we had more debt in the past. What it does mean is that America has a lot of head room to issue a lot of debt. Whether or not that is wise is another issue.
     
  6. midcan5
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    midcan5 liberal / progressive

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    Exactly. "The economies of France, Germany and Japan have emerged from recession, and the U.S. economy appears to be returning to growth as well. U.S. stocks ended the week at 2009 highs on Friday after a big rise in home sales and optimistic comments from Fed chief Ben Bernanke."

    It must or should strike these right wing corporatists as odd that the so called socialists and the Japanese - who take care of their own - do better than the dog eat dog American economy. It should - but when all your news and ideas come from Rush, Fox, and the WSJ what can you expect.

    http://www.portfolio.com/business-n...trichet-warns-on-complacency-as-economy-heals
     
  7. jreeves
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    jreeves Senior Member

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    Thank you, it was a bit of trap. So, much of Europe and Japan has a much higher debt to GDP ratio. Could it be that these countries health care costs are a contributing factor to their debts?
     

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