“Be careful what you wish for - it might come true”

There were plenty of warnings of the likely impact of Bush’s tax cuts on the US economy - that the promises were as likely to be sweet violets as they were to be roses. The tax cuts for a start are inflationary.

I doubt that anyone is concerned about how much of the US is now owned by the Chinese - through their funding of US government bond issues. That pumps even more liquid dosh into the US economy, and (if the pundits are right) increases the rate of inflation.

But the biggy is the mortgage market and the likelihood of that imploding. There was plenty concern about Freddie Mac and Fanny Mae some 5 years back. Nothing came of them - in terms of predicted collapse. So, what are the chances this year? Well, look no further than Citi Group for a start…

And, the relatively nice thing about this development for the candidates is that it actually spares them from having to administer strong medicine to slow down America’s headlong rush toward insolvency. Market forces will slow things down automatically.

That’s because as the dollar sinks in buying power, foreign-made goods and services become more expensive to Americans. At the same time, U.S. exports become more affordable and attractive to foreign consumers.

Bush & Co. will step in to stop this process if, and only if, oil-producing countries like Iraq and some of the others switch to doing business in terms of Euros instead of dollars.

Nobody goes to the UK really– highest personal debt levels in the world there and bracing for a fall. Also, even many Canadians and Australians are moving to Germany and other Euro countries for the same reasons. If you can work the same or even more modest hours and make more money, with better quality of life and better schools to raise your kids in, why not? And Germany/Austria is just visually appealing to live in– not to mention places like France, Switzerland and Italy!

The only hurdle is just language, but German’s handy anyway for anyone doing tech. And French isn’t too hard to learn if you’re there.

I’d advise any professional in North America, Australia, New Zealand or similar places with this currency mess going on (or in the UK for other reasons)– learn a Euro language, esp. German if you’re technical, or otherwise something like French or Italian if you’re inclined in that direction, and consider moving. You can get a lot more done, and get paid a lot more in the process, with a better place for your children to grow up in and attend school.

wj, my guess is they don’t bring it up because any solution will mean instant pain to the voters. The only way to correct the problem is a combination of balancing the budget (can you say tax increase?) & tightening credit, meaning an instant recession. Far better to put off dealing with the problem until after the elections, if that is possible. This appears to be the reason for the Federal Reserve tactic of lowering interest rates.

Neither party wants to have to talk about what it will take to fix the problem because it would cost votes. OTOH, if we are in recession before the election, the GOP can kiss what little chances they have of reelection goodbye. Of course, then they will blame the recession on the Democrats.

Of course, they could simply give out economic insanity and pretend that it was workable. After all, Edwards (among others) does that all the time, and rarely gets challenged on it. But why take the chance, as long as they can just ignore it?