wait i just had a record scratch in my head when i read this.. i dont know if this makes me ignorant but who did we get all these loans from and why are they dumb enough to keep loaning us money that they will never get back?[QUOTE="fl4tlined"][QUOTE="AL_GREEN"]whoever we owe the 14 trillion to should just let it go and it would solve all our problem.Phaze-Two
i think it's mostly gemany, japan and china.
it's kind of funny that we're barrowing money from our old enemies.
Japan lends money to the USA because their economy is disproportionately export driven. Their success is dependent on American wealth. More recently they've shifted to exporting basic goods to China, shifting away from America. China then sells these goods to the Japanese for further value-added products, or to the Americans. China lends money to the Americans because it fuels their abnormally high growth. China has, and will continue to buy T-bonds to support American spending. It's no big deal, they won't flood the market for bonds because they have no incentive to do so (this would force the dollar to plummet). The remnimbi is in no position to succeed as dominant currency. That leaves the Euro, and their banking system is a mess. See Ireland/Greece. Furthermore, the best thing the US can do is stimulate the economy by improving infrastructure (education), because relative to Japan it would provide the biggest efficiency and productivity gains (skillsets). Another thing to do would be to stimulate savings (for those savvy with savings-investment functions) to generate growth. In times of hardship... spend spend spend. :)
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