America after WWII was like single shp left when 99 got burnt out. That good half centuty has ended. Power is twin of money. Lust for waging all wars in Asia, Middle Eeast Latin America and Europe after WWII was to stay as Super Power. That sapped out American economy. Now whole world is going bankrupt, so no one would care which country is Super Power till next two decades.
America is NO longer an economic superpower – it is following the path of Romans and the British. We are seeing a change of economic leadership to China and Middle East. American dream is more like a nightmare now – this country has no real future and no real leadership.
Since WWII, the U.S. has turned into a consumer economy. That was fine when there were jobs that paid the wages to support this type of economy. We started exporting the good paying jobs overseas in the 1970s and have now painted ourselves into a corner.
We were able to keep the party going for a few decades with credit, the Internet bubble of 2000-1, and the Housing bubble of 2002-6, but now our credit is maxed out and wages are not keeping up with the REAL increased cost of living.
Something is going to have to give. Either we start raising wages so that people can spend, or we accept the fact that the consumer is tapped out and will not be spending as much.
Yes. We always start up at the top and work our way down. How hard is it to realize that you have to start at the bottom and work your way up to the top. Is government that stupid that they cannot figure this out. In anything you do you have to go up not trickle down. It has never worked like that but the government continues to think it will. Start a committee that is legitimate including everyday joes and they can fix the economy which wall street and the government cannot. Put a housewife, construction worker, school teacher, fire fighter, policeman, store clerk, fast food worker on the job of fixing what is wrong. They know! They live it everyday. The 401 ks, retirement accounts, homeownerships, ect are not in their vocabularies anymore. Ask the regular folks for once and I assure you that the country would run better and be in better hands.
If anyone thinks the US is still any type of superpower with the mis-use, mis-manage, over spend and over-all abuse of control then were kidding ourselves.
It won’t as long as the United States keeps attracting smart people from all over the world, the democracy & freedom, and the American dream — to create something new.
We cannot continue to spend more than we make. Our country is no different. The national debt will ruin us the way we are going.
After all is said and done,the greed of our political and bussiness leaders has come to expose their actions for decades past. As Americans, if we don’t get rid of most of the carrer politicians,and hold the incoming replacements in strict accounability for their behaviour then in fact the USA and in particular the citizens will see the demise of our great country happen sooner than it is generally thought possible. Two years max.
I whole-heartedly agree with Frank of Schaumburg, IL . America truly needs an answer to this consistently reoccurring choice of just two parties who in reality are increasingly mimicing each other. America truly needs a third party ( or perhaps more ) like other democratic countries.
Yes it is just a matter of time. The euro skeptics thought the political barriers would likely disband the young currency. It is clear it is a new contender as a world reserve currency. The US savings record is negligible so compared to Japan the US is in dire straits. Japan despite savings has had 20 years of deflation. What will the US fall back upon? More debt?
Regarding the housing crisis… the basic intent of the 1990s Community Reinvestment Act (CRA) was good. From a moral perspective, the practice of red-lining is indeed discrimination against African Americans, Latinos, and poor Whites. BUT, in practice in the Clinton Administration, the CRA was used to beat up on banks to get them to loan money to people who could never pay those loans back. So, let’s stop condemning only the Republicans and focusing only on the last five years. Both political parties are guilty of contributing to this mess, beginning with Clinton and continuing on through the Bush years. Let’s stop assuming that the Democrats are holier than thou.
CORRECTION:
The media ( CNN, NBC, FOX, etc. ) are reporting no different than what other media around the world is reporting. The problem is; Americans may not be happy with it because it isn’t always what they want to hear even when it’s the truth. This has been the problem all along. It’s called sweeping the truth and/or problem(s) under the rug so that they may possibly resurface later on. It’s better to confront the truth and/or problems early on and head-on so that it/they can be dealt with before possibly getting worse.
The media ( CNN, NBC, FOX, etc. ) are reporting no different than what other media around the world is reporting. The problem is; Americans may not be happy with it because it isn’t always what they want to hear even when it’s the truth. This has been the problem all along. It’s called sweeping the truth and/or problem(s) under the rug so that they may possibly resurface you later on. It’s better to confront the truth and/or problems early on and head-on so that it/they can be death with before possibly getting worse.
This is a dumb question with a lot of dumb answers. The US is 1/3 of world output and GDP. No one is even close, including China and India, who derive most of their income from US consumers. If we fall, they fall, as demostrated by the current crisis that we, and consequently, the world is in. If you want a good guide on how wealthy we are, use how much we are hated. The more the rest of the world complains/hates us, the better we are doing. The media likes to make it about policies, but in reality, it is about money. lets call it the “hate index”, and just prior to current crisis, teh hate index was at an all time high. Sure, it will go down because of the current crisis because a lot of countries will be begging for money to stabilize their economies, and you can’t be a good beggar when you are spitting on your mark. And it will go down when Obama is elected, because he will send more of OUR money to help those poor, abused and used people in Africa, who in the long run will be no better off because of it. But eventually, we will be hated just as much as before because we will recover and become even wealthier. that is the nature of freedom and the pursuit of dreams.
If you compare GDP against the national deficit, the problem is not as big of a deal as CNN Money describes it to be. I get tired of the media creating hysteria. Not only CNN but FOX, the media makes the national deficit look like a bigger problem than everything else. We don’t hear much about the war on Iraq? Why not? The media focuses on how they can create hysteria quickest. The media fails to meet public obligation to inform (accurately).
The last great empire to fail was the Ottoman ( Turkish ) Empire which ended in 1922 and which later formed in 1923 into the present day country of the Republic of Turkey. The U.S. is next in line. It happens even to the best of them. History doesn’t lie.
Wasted money and wasted opportunities including wars ( starting with the Vietnam war ) that never should have been. Unsustainable waste ( including gas ) by a population that never saw end in sight. A transportation infrastructure that never truly adapted towards mass transit. It was bound to fail and it was only a matter of time as to when. Now that has been answered.
The US financial institutions will get none of the credit (the Left leaning Dems will take the credit). US financial institutions will however suffer all of the blame (when the Left leaning Dems shoul be getting the blame). And don’t forget to throw in a whole lot of greed on everybody’s part for the mess we are in.
I agree with Andrew from Salt Lake City. Yes our days of dominance are numbered. The common sense is you can’t spend borrowed money lavishly and still get away with it. Our days of threatening creditors with our military power have been gone forever. Look at who is our biggest creditor.
China. And look at what they’ve got. Nukes, just like we do.
The fundamental problem is the return on energy not the housing credit crisis. We will dip out of financial superpower status yeilding to the opec nations until we get on another prime energy source.
No, because it’s our SPENDING power that fuels the world. China and the middle east have no economies without the US. I just wish we would do more spending at home.
I believe we will remain a financial power but one among many. We have lost favor in recent years from over regulation in the form of high taxes and compliance requirements like the Sarbanes Oxley Act. The capital we speak of, in the billions of dollars, can move to regions where costs are less expensive.
For those of you suggesting that Europe is the new Super Power, a little geography lesson is in order: Europe is a continent, not a country. They cannot even agree on how to regulate milk; never mind agree on a constitution. Most of Western Europe has declining birth (and growth rates). Their future does not look too promising. The US has a positive growth rate, an extraordinarily diverse and flexible economic base, a mobile population and represents 25% of the worlds economic output.
Our problems are corruption, and debt. Unless those problems are solved, we are toast..
We cannot start to solve those problems, until we have an honest unbiased media.
Wm A
It depends on the timeframe. In the next few years? No. Decades? Probably not. Century or two? Definitely. That’s just the path of history.
A financial superpower is more than financial might. It is a standard by which others can aspire, it is doing the right thing that benefits all, not just the US. Has the US lost its position? Yes. But to be fair, it is still a financial superpower just not the “world’s financial superpower.
We can’t remain a financial superpower. The global economy prevents that from happening. As jobs are outsourced around the world, the economies and standard of living in developing countries will increase to include wages, etc. As those jobs are lost in established countries like the US, Americans will have to settle for pay cuts to secure the remaining jobs and the standard of living will decrease. The only benefactors of this policy is the rich. Only a fool will believe the bailout will create jobs or prevent the loss of jobs in the US. Everything between the top and the bottom line is an expense to be eliminated. Every company out there is concerned about one thing…shareholder profits so they will send every job where the labor is cheapest period. Once the economy is “global”, only then will we be competing on a level playing field with workers in foreign countries, but until then the standard of living will continue to go downhill in America for anyone but the elite who are driven by power and greed. There is no incentive for creating jobs in America when they can extract profits from foreign economies. Money is money and those in power could care less where it comes from and who is suffering in America. Yet the government will have us believe the bailout is going to benefit us? Middleclass America and below is paying to increase the wealth of the elite and “save them”. If you don’t believe it look at the changes in the quality of life in China, India, and other countries where we are sending jobs. The salaries are increasing along with demands for benefits equating to increased standard of living. Bush claims this is good and frees up Americans to pursue bigger and better things. I haven’t met a single person who lost their job to outsourcing who has found that golden nugget yet, but I do know plenty having to take pay cuts as they train foreign workers to take over their jobs to buy themselves time to find something else for less money. Our jobs and money are all going overseas so it’s only a matter of time before we’re down there with the rest of the world economies.
United States is by far the most advanced economic system existing worldwide. The concept of market-based pseudo-invisible hand system with Fed regulatory measures is an undestructible system that has a high rate of resiliation. Despite the pessimistic view that people have on American economy, a macroeconomic glance over the public finance brings forth a solid strategy of further US economi reconciliance. US Dollar is by far the most used currency in our planet, and the most convertible currency there is (its an exchangable unit among Gold and SDR – Special Drawing Rights in World Bank) and part of every country’s national bank reserve. By ‘loosing credibility’ in its own economy, US seeks to make international persons (be legal or physical) to doubt the dollar, so it can call it back to Fed in a record low price (in comparison with Eur or GBP), and then “suddenly” stabilize the market making the dollar trustworthy again. But this time its value will have peaked relative to Eur, and simply selling it back to where it bought will grant billions of revenue. In the ‘crisis period’ US would have already increased the export of US products (as due value depritiation its products are competitively advantageous). The temporary disatvatanges in small and medium businesses are just means to reach ends. In the end US economy wins, and all others follow. Everyone will be better off, as the world already realised that a troubled US economy will hurt us all.
Throwing good money after bad has never worked. It’s bizarre that intelligent countries can decline by such fudamental errors that lead up to this. For over 20 years I have heard about the USA’s economic problems (or hollow economy). The Govt just prints money whenever it’s needed and spends ridiculous amounts in the wrong places. These unfolding events are sad. How could such simple financial principles be ignored when you have brilliant teams of analysts and advisors? The results we are seeing now MUST have been forseen.
Regardless of our Triple A rating, we are witnessing the end of an empire. I am so saddened that my children will never know the America that I did.
It depends on how we respond to the challenges we face. We cannot do or have it all. Other countries must do more to respond to security threats. Americans must be willing to work harder and smarter to stay ahead. We must do more to help the lower and middle classes and realize that trickle down economics does not work.
The great race continues…
The 16th century belonged to Spain.
The 17th century belonged to The Netherlands.
The 18th century belonged to France.
The 19th century belonged to England.
The 20th century belonged to The USA.
In the 21st century, we will be handing the baton to China.
Anyone who thinks this $700 billion dollar bailout will somehow make our country stronger is sadly mistaken. The package is backed by nothing at all, but the air from which it came. China, Japan, and various other countries admittedly refuse to lend the US money for fear they will not get it back. Our country manufactures nothing and is largely a service economy for ourselves. The only thing we seem to be doing these days on a fairly regular basis is to start wars.
I think the tables have certainly turned for our great nation and her dollar, but for some the Amero was and is the answer anyway. If you think that’s not on the table you would be wise to think again.
The American economy in the last couple of decades has been based on artificially inflated asset values or on dismantling American industries for the sake of short term profits for executives and shareholders. The US economy is based on greed and corruption rather than sound financial fundamentals. It is neither a super power or global leader but has been devolving into a third rate shadow of the country that it once was, or perhaps only claimed to be.
Most definitely. I can’t run my household on continuous debt. The Country can’t run and function on continuous debt.
The United States began losing its economic superpower status the day the Congress voted away their responsibility to maintain a national currency to the Federal Reserve Bank, under the Woodrow Wilson administration. That gave the Country the opportunity for massive, unpayable debt and fiscal responsibility.
I fear the days of the United States are numbered. I fear that one day our creditors will demand repayment of the money we have borrowed and squandered on wasteful spending and corrupt policies. I fear that when those creditor nations demand repayment and we as a Country cannot repay, that they will seek to claim ownership of our lands in lieu of repayment of those debts. Dark times are looming for America unless we tighten our belts, balance the budget, keep jobs within our borders, and pay off that $11 trillion debt.
What continues to frustrate me is the apparent belief the middle class and below can’t manage their own money. I regularly hear we can’t trust people in those areas to make the right decisions concerning finances, voting, etc. I hear the argument made for not going with the popular vote because we need the electoral college to make the decision about what we want versus what we think we want. As a result, the destiny of the country is placed in the hands of the “elitist” and we see where it’s gotten us. Policies that benefit the rich and those in power. Increased taxes on the middle class and below because they know how to better spend our money than we do. No accountability for our decisions. Each time people make poor decisions they don’t have to suffer the consequences and expect the government to bail them out. If people want to see where America is heading, take a good look at Europe. Socialization is on the rise. Government involvement is increasing in every aspect of society. Before long no one will have enough money left at the end of the month to pursue their own dreams and goals. The government will be too busy taking every dime they can get their hands on to support people who continue to show a pattern of poor decision making instead of letting people suffer the consequences. America became strong because of determination and hardship. It was the fight to survive. It was the understanding you had to look out for yourself and bust your backside to survive. We are too quick to say, “Poor ….. Let’s throw money at them because they can’t seem to get it right.” We’re quickly losing our financial superpower status because we continue to make investments in the failures of others. We are no longer a country where everyone pulls their weight and too many people want to sit around with their hands out looking for a free ride. I guarantee you when people are held accountable for themselves and we quit supporting them, they will find a way of surviving. If charities want to ask for donations to help them out, then that’s an individual choice to contribute, but not an obligation for every American. However, our position as a financial superpower is quickly fading because we continue to make bad investments in hopeless causes.
Yes, the US will remain an economic superpower. Even though the multiple bailout bills are controversial, they will prove to be effective policies in freeing up the credit markets. Every downturn provides a lesson and the resulting economic growth thereafter is more stable and stronger. Many worry that Government debt is the way to destruction but deficit spending is most effective way to stimulate an economy. The restoration of our economic stability will more than pay for these bailouts. If the bailouts did not occur, the budget deficit would likely increase as the impact on tax revenue from thousands of failing businesses and banks leaving the market .
Further, the US was not the only country in financial trouble, we are the top of the world economy and when we fall, others fall as well.
The Fed also has the tools to counter inflation, most of this money is not printed but actually gathered from the selling of US bonds. Our Monetary base will only increase by small margins, if inflation reaches unhealthy levels, the Fed will raise interest rates by decreasing the monetary base.
Market expectations and consumer confidence are perhaps the most important aspects of our economy. If Macroeconomics was a mandatory science in our public schools, most of our politics would be streamlined and our markets would be even more powerful.
So when the rest of the world “asks for their money back” is the European Union going to march on Washington to get it? Or will it be the Chinese? I just want to know what language I should study next….
The American Government has all these current financial issues on one giant formula. Most of this crisis was predicted years ago. When this World economic crisis passes, USA will once again be stronger than ever with the dollar strong and the national debt being a much smaller issue going forward.
definitely. Many phamaceutical companies such as RSK are planning (or already did)to outsource their R&D to China. Rumor has it that IBM will send all of its R&D to China and India (thus providing them tens of thousands of high-tech,high-paying jobs). USA will become a major farming country in decades to follow…
36 years as a mortgage lender (all “A” paper-not sub-prime thank you very much) and we’re finally going to return to the good old days. Not everyone deserves to be a homeowner. Some are destined to rent forever. We’re going to lend money to people that are prepared to make a down payment, can demonstrate an ability to repay (based on debt to income ratios)and a willingness to repay (based on credit history). What a novel concept! Wall street screwed the market up by creating financial instruments that no one but them could possibly understand and now they scream “bailout.” I’m outraged. By the way, I’ll survive the downturn in the mortgage business because I’ve managed to save some money to get me through. Failure to plan for the obvious downturn has created an emergency for millions that I’m going to pay for. What a travesty.
The United States already lost its “economic superpower” status — the second it went off the gold standard, and years later when it became a debtor nation.
Its already happened long ago.
Note to Andrew in Houston: The subprime mortgage mess is not the cause of this whole problem, it’s the straw that broke the camel’s back. The real cause is decades of government deficit spending by “borrow and spend” Republican administrations starting with Regan and continuing without letup through both Bush administrations. The huge federal deficit means our children, grandchildren and great-grandchildren will be paying for our lack of responsibility in paying for the services we want from governmnet. BTW the subprime mess was not a direct result of encouragement by either the Carter or Clinton administrations, the problem occurred in the past 5 years of the Bush administration when they turned a blind eye to what was an obvious bubble in real estate facilitated by large investment banks being allowed to convert mortgages into securitized debt notes that were sold world-wide. On another point, you loud-mouthed conservatives love to bash Carter but the truth is that the drop in inflation and resulting growth in the economy during the Regan administration was much more the result of Paul Volker’s management of the money supply as Fed Chairman. Oh, did I mention that he was appointed by Carter?
No the us will never lose its position as the world’s financial superpower. The reason is the foreign investors pump money into our country because we are so stable and they always will. The world knows that a group of armed rebels will not invade the us and unseat our gov. The real question is when 1000s were losing their homes and going hungry, why did our gov. only act when the crises reached the big boys (mostly foreign investors)???
Well I think people need to understand that the government alone cannot make or break the economy. It is the responsibility of every American to be wise with their money as well as the amount of debt they get into. It does not matter if they are a CEO of a bank, a politician, or a blue collar worker. Every American is responsible for the crisis in some way. In order for us to improve we must realize that some charismatic politician will not lead this country into another golden age. It will not happen because their will always be those who buy more than they can afford, or fail to pay a loan back. Greed must not be the driving force of the economy any more.
The US doesn’t need to be a superpower, they need to be competative. Right now our economy is hurting a little bit, but even if our most major institutions collapsed, like our investment banks, there are countless little guy businesses just waiting for a nice opening like that. The vacuum in any industry left by a failing ailing giant like morgan, goldman or whomever, will be filled by someone up and coming. The US needs competition to remind us that we need to get better. Having been the best in the past is good for a plaque on the wall, but it does not buy you a way of life, and certainly does not ensure you a future anything similar to what you’ve had in the past. (Or that your parents had, because a lot of the people in the workforce now have never had the cushy lifestyle the US enjoyed when women stayed at home, men went to work, and dinner was always ready by 5.) The world changed, and we had better change with it. Who cares about super powers. We need to be good, when compared to everyone else, but we don’t need to be the only ones.
LOL
We have already lost our military position to the Russians. We have lost our financial position to the Chinese.
So in a nutshell we are fast becoming a third world country where corrupt government officals run the economy for their personal benefit.
Grab you money from the stock market as it is about ready top totally crash in a couple of months. Head for the hills and as the Federal Reserve Governor said two weeks ago buy food, gas and ammo.
Good Day. From an ousiders perspective the following. America is seen as the biggest consumer in the world or if you will”customer in your local town or city”. What has happend over many years is that this customer has spent to much money and is now in a position that their liabilities are exceeding their assets. Sooner or later you will run into financial trouble and the current global financial position reflects this. You guys need to look inwards and concentrate on your own problems instead of trying to solve everyone elses. Many of the comments reflect this. A start may be much more stringent credit regulation that will keep the consumer from making excesive debt.As a financial superpower you have only gained this accolade because you spend so much and need to import most of what you spend on!The biggest customer in the world has got a “financial cold” and now the rest of the wold is getting “financial neumonia”. It is each and every Americans duty to see their Doctor about their own “cold”. Get that right and everything else just falls in place.
@Frank
“C’mon, America, would you please stop voting for Republicans and Democrats (who have both sold us out) and start voting for Third Party candidates? Both parties are corrupt. Why don’t we throw all the bums out of office? Why aren’t you using your power at the ballot box?”
Agree 100%. Unfortunately WE THE PEOPLE are not smart enough to figure that out just yet.
Empires are built on hard work, responsibility, solid planning, blood, sweat and tears. They are not build on debt, corruption, financial schemes and tatooed power shoppers equipped with a credit card and a sense of entitlement.
No, the US has ALREADY lost its position as the world’s financial superpower. When everything is said and done in a couple of years, the entire financial system will be in the hand of foreign powers as well as substantial part of the stock market. If the Dow is not in the 7,000 level it is because foreigners are scooping big chunks of US companies at TJ Max prices while americans sell on the way down.
Good bye USA.
Within 50 years China will become the world’s dominant power – sooner if the political climate there changes. Whether it shares the stage with the US then is largely dependent on the policy of our current leaders and the ones to come in the next few years. Unfortunately, our current leaders aren’t very good. That goes for both political parties, as well as the leaders in the business world. The fact that they all have to get in bed with Chinese money does not bode well for the rest of America either. In short, while the markets may recover stronger after this crisis, the US may never recover its standing in the world.
The Big Picture is the USA is trying to deflate its currency by printing paper with a number on it to pay for its need to satisfy its daily deficit import bill of millions of dollars it then has to borrow from the rest of the world. Zimbarbwe inflation is about to come while another daily plan is urgently announced. If the rest of the world every asks for its money back or decides not to provide its money for even one day then the USA will lose its power in that instant. The power of the USA is in the past tense. The irregular change of world domination is in progress. This always brings instability. Hence the market and world exchange rate volotility at present. Be aware and prepared. History is now.
I believe that the US is still and will remain for the forseeable future, the world’s predominant financial and military superpower. I do however believe that this bailout plan is greatly amiss, since the roots of the financial problems are not so much the taxpayer’s fault; it is the megabanks of the Northern hemisphere’s and OPEC that we should blame.
Why is it the bank’s fault? They chose to lend money to uncreditworthy individuals. They charged higher interest rates for this, called Risk based Pricing, to recap thier losses in the event of default. So now the number of defaults surpasses the amount of interest earned for the risk based pricing structure, and the US taxpayer is now expected to cough up the money to repay these faulty loans. I was denied a loan some years ago, not due to credit but due to lack of down payment and income. I got an apartment and life went on. Perhaps NO should have been the answer much more often than it was. I think the banks SHOULD bear the burden of thier own greedy mistakes.
Why is it OPEC’s fault? When Saudi Arabia and Kuwait announced a cut in oil production approximately 5 years ago, oil prices began to trickle higher and higher by the month. Oil is the lubricant of the US economy. Oil runs locomotive engines, powers diesel trucks, powers farm tractors, our cars that take us to work…I could go on and on. Now that the price of this oil goes up, the costs of doing business go up as well. Prices go up. Jobs are cut. People cant afford to make thier car and house payments anymore. The loans default. Now that the economy is slipping down at a faster and faster pace, everyone panics and expects the government to bail everyone out. The same people that raised oil prices, OPEC, are now crying because thier petro dollars that they invested into our banks are losing value, AND the price of oil has slumped due to a decrease in demand. Whom should they blame for the economic crisis? Perhaps they should look in the mirror.
Yes, but don’t worry about it. The US is becoming a bit of a caricature of itself, sort of like Europe had 60 years ago. The latest crisis is really just a symptom of the larger decline. In the next decade we’ll see a new, leaner, more humble and modern US being reborn.
Since the US economy has the ability to impact the economies around the world it will still be an economic super power of diminished status. Less investors will look to the US as the safest place to invest and instead will just invest les, hold cash or other near cash instruments. Overall worldwide economic growth will be slow in recovering and hopefully it will not be a perception based “bubble” boom, but rather a solid, fundamental based path.
How can there be a ‘Financial Superpower’ that is tapped out and in debt over its head to the rest of the world? The money is spent and gone.
Now it’s: “Shanghai, Mumbai, Dubai or Bye-Bye”.
There is so much talk about the US being replaced about the new emerging giants China and India. I still think its a bit premature to write off the underlying strengths of the US vis a vis these rising economies. The US has much going for it, your basic fundamentals are still strong, a highly educated workforce, a vibrant democracy, very sound institutional framework , smooth transition of political power , Technological innovations, Some of the best universities and Faculties . All in all basically a society which is willing to re-examine itself from time to time and change for the better . Maybe you country needs to just rework its economic agenda from uncontrolled profit-seeking and consumption orientation to a more balanced social commitment.
After the crisis? WHAT CRISIS?
The little darlings on Wall Street and Bay Street in Canada threw a fit, with help from hysterical media pundits and self interested politicians, in order to sustain cheap money, a tap root of our dysfunctional, trouble prone North American economy. They got all that they demanded, at the expense of average taxpayers, disciplined savers, and the world’s poor.
Look now for agitation to prevent a return to sober bank practices:expect loud, emotive opposition to banks having qualitative evaluation of loan applications; look now for a new bubble around the right of every business application to be approved, especially those from a suddenly sprouted small business constituency.
World’s Financial Superpower ! With so heavy national debt ? With “horrible” trade deficit ? Definitely not ! US has lost it status in this crisis.
Europe & Asia will be better off in 10 years time. It is UK’s Gordon Brown’s concrete plan is working now for the time being….but wait and see a month time. Will he be the real “hero” who saved the global financial crisis … hmmmm…time will answer. GOOD LUCK TO THE FINANCIAL WORLD !!
We’ve lost it already. It’s also our arrogance that has driven the world away from us. Let’s realize we’re no longer at the top of the world, there’s other countries that are clearly strong competiton that are a huge threat of taking our Superpower title… America is not as “free” as we think it is, we have been losing our ground for quite some time.. Let’s all have a taste of “humble” medicine I think we all need it.
As far as the next superpower,,,assuming we continue in this down trend we’ve seen for the past +6 yrs, it could come from Asia, Europe or South America (BRAZIL)…
Remarkable that the USA claims their jobs go overseas whilst the world is accomodating the majority of the US multi-national companies without any checks.
Remarkable that a small country like Holland is the biggest real-estate investor in the US in abolute terms.
Yes, ‘we’ (only the US ?) survived the Great Depression. Have ‘we’ forgotten what caused that in the first place?
Remarkable that in WW2 the military bail-out of Europe by the USA and other highly esteemed allies has not provided a durable approach to greedyness and abuse in their financial system.
I am an optimist the way in which this ‘bigger than greatest depression’ will be dealt with in better way.
Not yet. Note the YET part. But its coming if the US doesn’t change its ways of intense overspending, sending all work overseas, and ignoring the country’s people while fighting a war thats draining every penny the country has.
Its already the most indebted nation in the world to all other countries. If it doesn’t stop, its going to lose its superiority. Its so concerned about everywhere else that its stopped paying attention to itself.
Trickle down economics doesn’t work. Sending jobs elsewhere doesn’t work. Our economy needs to be stimulated, our education needs to increase (contrary to popular wishful thinking, it is 17th in education in the world according to the newest UNICEF statistics) and the country needs to invest in itself.
If it wants to keep its top status, its time to take care of the problems in the US. Only in that way will it remain a financial superpower.
History has shown that big powers come and big powers go. America is no exception to this. Asia will be, if not already, the next financial superpower.
The closer we fall into socialism, the sooner our fate is sealed as a financial backwater. We should have let all the banks fail! And people that took out mortgages they couldn’t afford deserve to lose their houses. Americans…that used to mean something special…now we have turned into a bunch of lazy, whiny, greedy, coveting fools. We ARE the seven deadly sins. Don’t blame the politicians, bankers, or mortgage brokers. We all created this mess. And don’t trust any politician that places the blame on someone other than us, they are the liars that want socialism.
Reading through the responses to this question greatly disturbs me. Many of the people who have reponded cannot even formulate proper sentences with accurate spelling and grammar. Do you think the US can remain a world financial superpower with this level of education?
Evidently Yes! and the reason #1 is a Russia with the rich sources of energy supplies, several days ago they donated big amount of cash to save Iceland National Bank; unfortunately US and Great Britain refused to do this for the member of NATO Alliance.
Buying into some stock yesterday would have been a good idea. I wonder if the US could truley continue with the bounce-back we’ve seen today. The next 6-months are key.
I’ve heard Republicans blame Democrats for too long. Only once in the last 35 years has the purchasing power of the median wage gone up and that was Clinton’s second term. All the corruption, stealing, and printing of money all going to the top 1% just devalues the dollar. The only way to make the dollar strong again is to double everyone’s wages, cuts taxes, cut gasoline prices, or give everyone a 3% thirty year fixed rate mortgage. Maybe its time to nationalize the banks since Wall Street is incapable of maintaining the integrity of the financial system.
We are always running on credit. This is nothing new. When we get into financial troubles, the government always takes a stake in the stock market, and banks. It’s time for the government to make money to pay off it’s (our debt) debt. Jury is still out, whether our country will be a power again.
War of choice, tax breaks for the rich, deregulation, jobs outsourced, subprime greedy lenders, dependence on foreign oil, up to our necks in debt to China & your question is will the US lose its position as the world’s financial power. We lost it in 2000 when Bush/Cheney came to power! Look to the east to meet the world’s new super power – see what I see? China
I think the obvious answer is that the U.S. has already lost its power as financial superpower. The new financial capitals are now in London and Hong Kong. Overregulation by Government (e.g. SarbOx/404), insane mark-to market rules (SFAS 157) that have nothing to do with the reality, and lack of brokerage firms oversight resulted in the loss of the superpower position. This so called financial crisis was manufactured by masterminds on Wall Street and created a one-in-a-life time payday for a few at the same time destroying what’s left of the middle class. To make things worse, the government overreacted again and put this country on a dangerous path to socialism. What’s next? North American Union?
In 21st century, Innovation is key for success. China as ambition to become a super power but India doesn’t. India and America must come together. With Indian brain power and American money power, we can make life’s better for the people in both countries. India is worlds largest democracy and America worlds oldest democracy. Both countries should come together to beat China.
The recent nuclear agreement between India and America is historic and landmark. Majority Indians are in favor of good relations with America and have a positive view about America.
21st century need different alliances and alliance between India and America at all levels is strategic and highly needed. India sends highest number of professionals and students to America than any other country in the world and everyone succeeded (IT boom and silicon valley created by Indians).
21st century needs long term partnership between India and America.
China has no financial crisis. Did america ever think of that? Although many countries suffer losses, they have lost greater profits but still reek in only profits. And is there any wonder when 90% of all your products are made in China? Where is the room for homemade products and business growth. None. How could this be permited to happen?
A nation in debt is no superpower. Americans have always believed they are immortal. The superpower status was lost years ago. Europe is the world’s superpower, but don’t have the big mouth that we have all gotten used to from the past…
Its strange to see that americans still believe they are a “superpower”. This is an old title. Europe passed the US years ago. Maybe the Europeans don’t make that much stink about it as the U.S. but it doesn’t change facts.
You killed your entire economy by allowing all the free trade agreements to flourish. This allowed china to flood the US market replacing your own manufacturing, and India to outsource dreadful and poor quality services that frustrated eveyone replacing homefront workers.
Its beyond my understanding how your government allows this to continue and then are perplexed why people can’t pay their loans! Stop imports of cheap ready-manufactured crap and imitations from third-world countries and outsourcing of labor, and finances will gradually get back on track again.
If wealthier countries need to collaborate with trade from ex China, we can stipulate regulations that demand that only a small portion of a whole item ex 20% can contain parts from China – not the entire product.
We are a debtor nation. We came out of WWII producing and saving every which way. Now we borrow and consume.
And guess what? It matters. Debtors do not have power. Lenders do.
While there is no single nation poised to take super power status from us on the economic stage, that does not mean we wont lose it.
Yes, the stock market soared. But the fall out is not over yet. We have years, perhaps decades, of belt tightening and living within our means ahead of us. It is time to pass the baton for our own good.
Yes and it is happening as we comment. Lots of good comments, but any comparison to the past overlooks the tremendous differences such as: 1) we’re now a ‘Services Industry” vs Industrial, we have gone from a nation having the highest number of graduates from High School to #39, from a nation of savers to debtors, a nation built on self reliance to Unemployment Insurance, Medicare, Social Security, Welfare galore and soon “Universal Health Care” NONE OF WHICH WE CAN AFFORD. Oh did I mention US CEO’s who 20 years ago received a salary ~50 times their average employees and now its almost 500 times. And lets not forget our politicians, who have the well earned lowest approval ratings both domestically and internationally in history and the lead Presidential candidate that announced, without consequence, that we all need to learn Spanish.
The US gave up its financial superpower status sometime ago when it started shipping jobs abroad at the benefit of big corporation profits. We were told that we have a blooming “services” industry. Now that this was shipped out and the “services” related corporations (banking and financing) need a bailout, what are we supposed to say? I do not know how we can be a Financial superpower when all we produce is sophisticated weapons and nothing else. Real people are not making money and the last good years of apparent “good times” (2001-2007) were all on credit… Now that everyone is maxed out including the government what is next?
Good luck to all of us.
Even before the current crisis foreign powers were aligning themselves and adopting the slogan “economies of the world unite.” The European Union is an example of this. In order to remain in the upper echelon of economic superpowers we will have to form strategic alliances with the right countries. The days of going it alone are coming to an end.
Yes! After WWII the U.S. rebuilt Japan, Germany, to what they are today. The U.S. has money to burn. Print as much as they want. China with its free trade will over take the U.S., but who relly cares when thay do. It’s a free market for the entire world financialy. Remember, its the “NEW WORLD ORDER”,& its here to stay. The only difference is we’ll be in controlled be the entire world
How ironical that it took another Bush presidency to realize the elder President Bush’s dream of a ‘New World Order’…though not in ways he anticipated
We, the American public, are guilty of letting our politicians and party contributors turn our country into the most fiscally irresponsible country in th world. When you add-up the number of “hand-outs” per month to our line of financially dependent countries that we pour hords of US dollars into it becomes dizzying to look at. A financial superpower, maybe, a financial house of crooked cards, yes. The world new before today they just did not want to believe it.
The classic “tax and spend” proposals coming out of Washington from this crisis worry me the most. It reinforces my belief that they know nothing about economics and didn’t learn Lyndon Johnson’s “guns and butter” lesson. They also didn’t learn the lesson of 1970’s inflation.
We were able to weather the 2001 recession well because we had a budget surplus. People were more than willing to lend us money to get us through that crisis. That’s not the case, now.
Debt is almost always bad. It limits your options in the future, especially if your spending it on nebulous programs that provide no guaranteed ROI for the US Treasury.
We have to get the national debt under control and regulate our financial system to keep corrupt and greedy individuals from causing another confidence crisis.
If we can get the debt under control, we can maintain our financial superpower status. We have to learn to live within our budget. We also have to end the party that’s been going on for the past few years in the senior executive ranks.
Separate from all the other reasons,
The US will eventually lose its superpower status due to the relative size of the US compared to other countries.
If China were to only be half as efficient as the US combined with its population of 4 times the US, Chinas GDP will far exceed the US (read as military, space, etc expenditures will exceeed the US)
Ditto for India.
Separate from the issue of “is the US falling” is the issue of “The US can not keep up with the rise of other countried with 1.2 billion compared with 300 million”
With all of the outsourcing over the past 10 years, do we really have many high-paying manufacturing jobs left in the USA? C’mon, America, would you please stop voting for Republicans and Democrats (who have both sold us out) and start voting for Third Party candidates? Both parties are corrupt. Why don’t we throw all the bums out of office? Why aren’t you using your power at the ballot box?
We were once the bastion of free market capitialism. Now with the FDIC under Sheila Bair idiotically preemptively seizing going concerns nobody is gonig to want to invest in our nation. Equity holder and Debt holders were screwed and are livid. Capitalis taking flight and the little that stays will have to price for random seizures where the government is complicit in the action.
No. Learn your history. The US dragged the whole world into the Great Depression. Its superpower status, while apparently unrecognized by Hitler, remained undiminished throughout that period, and it emerged as THE SUPREME superpower at the end of WWII. And, obviously, nuclear bombs had nothing to do with retaining its supreme economic superpower status.
Yes, when pigs fly. Europe needs to follow its nose, up into the air.
The real question is time frame. The U.S. may very well be replaced as the financial superpower, but not in the next decade or two (or probably three or four). A lot will depend on overall world conditions, China, India, and the war on terror.
But Europe? I don’t think so.
What happens if we buy assets from a bank, take a position in their equity and the bank still does not start lending funds to business?
Yes, I do think the US will remain the lead financial institution in the world as long as we stay free.
Did somebody ask about responsibilities of Democrats in this? 80 years of government-subsidized mortgages (GSEs created by Roosvelt), with weakened standards (by Clinton) and social housing programs in exchange of votes (ACORN). Looks like there lies a pretty big responsibility for inflating the housing market! Owning a house is not a right, it is something one earns with hard work. Cheers.
The US currently looks like a bunch of uneducated retards to the rest of the World. How can the World trust a Country that cannot even manage itself. Broke is what the US is, battered and used. With the largest defecit of anyone else. Now asking myself how would I view the US right now. I will tell you this it is not pretty nor would I have any faith in their abilities. Ths US Government is by far at the point that everyone in it should be Fired and people put their that actually understand economics and care about the country. One more thing that makes the US even more unreliable is how can you talk about feeding the world when your own people are starving. Very sad state of affairs. Truth being this is never going to get better the proverbial snowball is heading down the hill.
Questions that are worded like this are completely irresponsible.
1) This is a leading question…. it causes the reader to consider the implication where or not they may have believed it before or not. Bad journalism.
2) There is no timeframe specified in the question. I could answer yes, but not for another 50 years. Another person could answer yes, in 500 years. Yet another might say no, thinking that the question only refers to the short-term. Of course the U.S. will eventually lose it’s superpower status. The question is when. This must be specified in the question to avoid tainting the responses.
Democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves largesse from the public treasury. From that moment on, the majority always votes for the candidates promising the most benefits from the public treasury with the result that a democracy always collapses over loose fiscal policy, always followed by a dictatorship. The average age of the world’s greatest civilizations has been 200 years. –Attributed to Alexander Frazer Tytler, Lord Woodhouselee
“US Bank bailout package = $700B = 5% GDP
Germany bailout package = $671B = 23% GDP”
To John of Columbus:
You forgot about the AIG bailout, the Fanny Mae and the Indie Mac and the others that amount to another 180 billion. We are really at or beyond the 1 trillion figure, and the press is fixated on how “wonderful” Europe is doing. They didn’t mention that Europe took a couple of weeks behind the US to make a decision.
The US will be first to recover, yes it will first to recover but only the top 5% OF THE VERY WEALTHY WILL RECOVER. hence that is why we the taxpayer are bailing them out.
“We the People” have not recovered since the oil crisis of 1973. “We the people” have been living with stagnet wages, chewed up by inflation and high taxes. “We the People” have been had by our Government, and “We the People” are really mad as hell and I’m not going to take it anymore.
Middle class tax reduction? how? When the government has no plans of reducing spending. We want to hear about 20,30 percent spending cuts. Then you can begin to reduce taxes. The national debt is the biggest gorilla in the romm, and no one see it?
And all of you pushing for a global currency, how will that help the USA remain a global superpower?
It is simple, congress doesn’t need to go to Washington to bring earmarks back to their citizens, if the money was left in the citizens hands to begin with. I can manage my money just fine, it is when I give over half of what I earn in taxes and fees, is when my money gets mis-managed.
Quit asking reactionary, stupid questions. Our nation’s media is largely responsible for the “hyping” of our economic troubles, the election campaigns, on and on. Start reporting facts and quit trying to create a reaction…
The US manufactures nothing except beer. We import everything. The only thing we export is fraudulent financial packages (securitized!!!!!) of delinquent mortgages.The international financial world bought many of them,and now all the world governments need to pay dearly to bail out their banks! We (US financiers and graduates of elite business schools) are the world champions of fraud!
The avg savings rate in the US last year was -1%. On average, we spend more than we make. Grab a calculator and see how long it will take to save enough for retirement/health care costs/kids college/etc. Havent we already lost?
I don’t think so. At this point, we were hit the hardest, but we’ve recovered just as quickly. But if we did lose our position, other superpowers will lose their positions as well. Sort’ve like a domino effect. We rise, the world rises. We fall, the world falls. So in conclusion, we will be saving the world’s a**. [Not surprisingly.]
Calm down guys! Sky is NOT falling. The fundmentals of US underline economy is still strong. We are still 1st place in the world competitivity list.
If you have depending on US’s the superpower status, you will be sorry. All country are all competing each other. A fair and healthy competition is always good for everyone.
There will be no lonely leader for long. If US leadership is not challenged often, it will roten within itself. This is a very health correction. We will come out stronger than most other countries, if not all.
US dollar will be on par will euro within 5 years. After that, a Dollar probably worth more than Euro. There is no fundmentals in EU to support a better and more productive economy than US, at least within next 10 years.
Of course we will lose our superpower status. Will it be because of this particular event? No, I don’t believe so. But we will lose it in time. All empires end, and I would assume that is especially true for an empire of debt.
It’s time we Americans get off our high horse of thinking we’re the best and most free country in the world. In truth, we are an incredibly irresponsible country that can only hold on to what little power and influence it has left in the world by bullying.
We are not a beacon of freedom and prosperity. We were once, but we are far from that now. It seems like every day I lose a little faith that we’ll ever be like that again.
The US now is now going in the same direction as Great Britain did after the Revolutionary War!
We are in EWW 1 (Econ. World War 1) and this is just the beginning of our slide to Mexico status. America is ripe for the Global interests that have Petro dollars to buy at bargain prices.
The one funny thing in all of this… it took a Republican Prez to shove us toward a Socialized banking system. Yay Republicans!
The more interesting results will be when the dollar no longer becomes the standard, replaced by the Euro or the RMB, and sovereign funds stop purchasing US Federal Bonds.
Gee I hope the manual also includes a chapter on how not to lend money to people who can’t ever pay it back ???
The “financial superpower” has been only perceptional to a lot of Americans and probably was never there to begin with. You buy stuff on credit cards and you are telling people you are rich? Does anybody know people in many countries (China is one of them) buy cars and houses with cash only? I wouldn’t have any problems if those people tell me they’re financially well off.
“The rest of the world” really sounds plural to me when the government talks about how far the financial crisis has reached. Last time i checked my friends in China were enjoying there “debt-free” life as usual. Guess what? They dont have subprime loan, and they dont charge their car downpayment to the credit card either. I started getting the feeling that the “rest of the world” really are the countries that went to war with us…
So define the financial superpower? Somebody who spends the borrowed money or somebody who sits on mountains of cash?
I don’t believe that the U.S. is in immediate danger of losing its status as the world’s financial superpower. However, the underlying problem that will threaten this status is the massive amount of federal, state, and local public debt. Like the majority of elected officials, both presidential candidates have not emphasized the urgency of working on this nation’s debt problem. We are only fooling ourselves, if we continue to think that own great country is immune from the consequences of this excessive spending and debt.
Jim, I have a friend just like you. Republican to the bone. He doesn’t even know why, but everything is the “Liberal’s” fault. Everyone else I know laughs at him, when they talk to him, and behind his back. You probably defend Bush too. Truth is, true conservatives have been warning about this for years.
We are losing our status slowly for several reasons:
1. Bailout
Look how the market responded to the EU Bailout today (up 11%) compared to the US Bailout 2 weeks ago (Down 1%). The world obviously believes the EU got it right and we got it wrong.
2. Debt-to-Income Ratio:
We have a National, Corporate and Private debt rate of 250% of GDP, more than double what most countries have. This means our future purchasing power is going to decline relative to other countries.
3. Trade Deficit
Our trade deficit is by far the worlds largest, $731 Billion last year, meaning we’re shipping our wealth overseas at astonishing rates. Compare that with China (+374 B), Germany (+254B), Japan (+210B), Saudi Arabia (+86B), EU Overall (-125B)
4. New economic dynamics
The world of 1945-1991 was US-dominated. The dollar was alone as the worlds reserve currency, the US and USSR were locked in a power struggle that forced everyone else to pick allieiences. The US economy was 25% og global GDP. This is no longer the case. The Euro is a viable competitor to the Dollar. China and India are emerging as huge markets. The US is 19% of global GDP and falling to 12% by 2030.
5. US Reluctance for National Projects.
Other countries are preparing co-ordinated national responses to challenges such as Climate change, Energy Independence and the Banking Crisis. The US resists such changes under the guise of individual responsibility and a strict anti-socialist mentality that disallows goverment intervention even in areas where it is clearly needed.
None of these things should concern Americans in the long term though. A world that is not US-dominated is not bad for Americans. We will be forced to live within our means, reign in our Military spending, form alliances and seek multilateralism, but we will be all the better for it.
The US will be still be the world’s financial superpower. People point to countries such as China overtaking us. However, we are China’s and the rest of the world’s biggest export market.
Chinese and European industries and services would be hard hit by a decline in our economy. If the US housing market collapse didn’t prove that to anyone, what more proof do you need? Much of the investment in development properties came from foreign countries.
People are too quick to recite doomsday scenarios. The US market is so dynamic because there are just far too many participants for one policy to overpower the market.
I am not sure but it will definitlely hurt american standing and other countries will close the gap for future.
The US will remain the world’s greatest superpower though it has persued a flawed, self deceptive economic policy for the past 7 years because it is still blessed with the most talented, innovative and competive citizens who live in the US.
America will remain the world’s economic leader for the time being, as no other country is ready to assume that position. But the American edge over #2, 3, 4 etc will shrink substantially.
Yes, Eventually. For the moment though, at least for the next 20 years, the US will be No.1.
I believe that this mistake of bailing out ‘Irrational (deliberate) exuberance’ will cost the US dearly (in financial terms) although I hope for all the world’s sake that it doesn’t because that will mean a very long recession.
Also, lets face it, how much good money can you throw after bad and not have the shareholders (US citizens) come after you (the politicians) for bailing out – in essence what seems to me: The Greed of Wall Street- so eloquently portrayed in Oliver Stone’s movie.
Thanks to ignorant groups like acorn and the aclu, who co-hearsed lending institutions and greedy lenders into finaceing low income people who should of never even been considered for a loan they wrecked havoc on the finances of the honest working people who had a job and worked to justfy their credit rating. these groups did an injustice to the poor people and the American people by their far left stupidy. The system only works if you work for what you buy.
The USA ofcourse is not going to lose its finacial superpower. We are the world power. Yes we have fallen harder then the rest but when we rise up again, which will happen, noone will be even close. We have helped practicly everyother coutry out there, its kindof nice for them to return the favor for once, it doesnt mean were not still a supreme power.
The U.S. has a tremendous economic challenges in addition to the current financial crisis. The recession is just beginning and could push many already troubled sectors like auto, airlines, steel etc. into a deep crisis. Many industrial U.S. assets are old and there has been an underinvestment in infrastructure. Unless the U.S. wants to borrow even more money from abroad to finance its deficit, I can also not see how taxes can come down.
They will continue to be satisfied to be at the back of the line. Have they ever wanted to lead, no they have always preferred to follow, thats the safer position.
We will continue to remain the world’s financial superpower because as long as our Federal Reserve remains interconnected to other world bank’s their greed will not allow the US to sink especially when our economy thrives off our debt. The more money we pay in taxes + more consumer debt = More money to the Feds!
I dont know who Jim is, or what he says, but in regards to Stephen from Valrico, FL, this whole financial mess is in fact the responsibility of the Carter administration for first drafting the idea of pushing sub-prime loans on low income/poor credit people. And the Clinton administration resurrected this idea, and did so with even more pressure on Freddie Mae and Fannie Mac than the Carter admin ever did.
Soooo…. unless you dont think that the Subprime mortgage mess was the cause of the financial mess we are in now. The only explanation would be that those to afforementioned administrations caused the problem
Yes, the United States will use its financial superpower status. But not today. When the Chinese people finally realize that communism is stupid and take advantage of their size, they will have an ecomomic engine four times the size of the United States. The math is simple after that.
Brock you are WRONG. Bush is not responsible for everything wrong in this country just like he is not responsible for everything that goes right. The economy, the housing market, and the stock market all function in cycles. The economy was due to have a lull. This time there were several problems occurring at once, and then people started to panic making it worse. The money did not just disappear. The companies and individuals that make the right moves will become wealthier, and those that make mistakes will lose or go bankrupt. Builders and realators knew they were overbuilding just like mortage companies knew they were making riskier loans. This mess is or will be a resdistribution of wealth and jobs. The government is doing more harm than good as someone mentioned we are already becomming a more socialized economy by trying to bail out organizations. Bailing out home-owners is even a worse idea. If we stick to our principles and keep this a free economy, there will be losers and gainers. People seeing a drop in their retirement funds is NOT a national emergency. We will come through this in a few months or a few years, but the USA is not dropping its economic superiority – in fact this just shows how much the world is dependent upon our success. Those factory jobs overseas is what allows us to have our standard of living. China had to halt factory production during hte Olympics due to the high levels of smog and pollution – not for the athletes but for their national image! In order to buy American we would be paying for medical insurance, environmental regulations, union fees to American workers, and we could not afford the products. I bought a Harley Davidson baseball cap at a Harley Davidson store for 35.00. I thought I was buying American as I walked out I looked at the tag, “Made in China”! It probably cost less than a dollar to make – China sold it to HD for 100-200% profit and HD made $$$$$ Look at GM struggling to remain competitive – their stock is at 1950’s prices – no longer competitive. Walmart is not buying American for the most part and is one of the few large companies still growing. Yes, the US could lose its superiority, but it won’t be in our lifetimes.
The U.S. is not going to fully lose that status in the immediate future. This current mess is going to be a really harsh adjustment but our institutions on the whole are not going to go under and the world is still too dependent on the U.S. for that to completely change in the next couple of years.
However, to some degree the U.S. has been losing some of its shine for a long time. Historically many great powers have succumbed to their own greatness simply because the whole populous became overconfident and complacent as we have in recent decades. Both our outrageous debt (public and private) and our increasingly crumbling infrastructure (educational, legal, transporation, etc.) threaten to slowly unravel our successes. This wouldn’t simply fall apart in a year or two but a decade or two out there is reason to be concerned. One hopes something will happen to change the mindset of the people and the government to get back some of the more responsible attitudes we had as we came out of the Great Depression.
Are you kidding? Half of America is owned by foreign companies already.
“Americas financial superpower” has sailed….or saled, as you prefer.
“US Bank bailout package = $700B = 5% GDP
Germany bailout package = $671B = 23% GDP
No, we have not lost our superpower status.”
China bailout package = $0B = 0% GDP
…you forgot that one. So we screwed over Germany and a bunch of other foreign coutries with our toxic financial products. That’s going to preserve our status as superpower exactly how? After having suffered catastrophic losses I am sure they will be more careful before buying into the next financial scheme Made in USA.
I’d also be careful comparing GDPs. In other coutries that usually measures how much actually gets produced versus how many happy meals and McMansion we can sell to each other.
Any nation as in debt as the USA cannot, and should not, be world’s financial super-power.
Balance that against this thought: ours is one of the most stable forms of government globally, and as such, other nations will continue to peg some degree of their financial fortune to the greenback. As well, for better AND for worse, Americans like to spend.
The growth of China’s, India’s and Russia’s economies seem to portend that the title will bounce between countries, moving forward. In the short-term, petro-dollars will likely drive the movement.
Long term, however, I fear the USA has spent itself into the position of being far less a force to be reckoned with than we once were.
The American people should wait until tomorrow to see the Japanese and the Chinese bailout package!!!
Hmmmm, let’s see.
Our national debt is at $10 trillion and counting. According to the former head of the GAO, our accrued liabilities are north of $60 Trillion for all the entitlemnet programs we have including social security and medicare (see the movie IOUSA). I think the term super-power is a bit overstated from a financial perspective. I think the USA is going BK.
The US needs to change the way we operate not just for some inferiority complex needing us to stay on top, but for our citizens who want the stability and prosparity of the 90’s. The US must stop the Oil, health care, and financial sectors from gauging the average american. Stop giving billions to other countries, we need it! Get our troops out of a country that does not want us there and is not giving us any of their $50 billion SURPLUS while we are in debt hundreds of billions to china and the saudi’s.
Our problem isn’t debt. Even though the numbers are huge, our debt is still less than our annual GDP, so we could clear the books in a few years, the same as we did under Clinton. It’s cute and simple to say we’ve borrowed and spent ourselves into oblivion, but it’s just not true.
Soros has part of the issue down right. A huge part of our problem arises from the bogis economic philosophy of “Reaganomics,”, which is doubly bogus because it wasn’t Reagan’s idea in any way, shape, or form. “Reaganomics,” “supply-side economics,” and “trickle-down theory” are all just brand names for what we used to call “laissez-faire economics.”
The whole idea of laissez-faire is that markets are magic. “The magic of markets” was a cliched catch phrase straight out of Reagan’s pitch for this bogus “reform.” The claim is that if you just eliminate governance, the markets will magically become more efficient, and all will be well.
Laissez-faire failed most dramatically in October, 1929, unless you count October, 2008 as bigger drama. What happened then was the same as what happened this time: people started cheating the system, and, since nobody was watching them, they got away with it until they brought the whole system down. This is what makes laissez-faire unworkable, a Utopian ideal, a fantasy: people cheat.
The good news is that we have some people in today’s government who learned from the Great Depression, and have now abandoned laissez-faire, unlike Hoover, who clung to non-intervention as the economy self-destructed. Because the government has been wise enough to recognize disaster and change policy, the overall strength of the economy is still sufficient to cover the losses we’ve suffered, and allow the economy to recover.
The reality of markets is that they are useful and powerful tools, yet they are not sufficient to all purposes. We cannot benefit by subordinating ourselves to any tool, not even a tool as effective as the market. Markets, like any tool, have limitations, and to live with them, we have to know those limitations.
Markets don’t regulate themselves. They need outside influences to help them stay honest. Even Adam Smith never thought of capitalism as a philosophical end-all. In fact, Smith wrote two major works, “The Wealth of Nations,” and “Theory of Moral Sentiments.” It is an error to imagine that “The Wealth of Nations” represents the whole of Smith’s thought.
Markets aren’t good at innovation, either. Innovation is a high-risk investment with a typically long-range return, and market priorities operate within a relatively short time horizon, and are risk-averse. To achieve a major innovation such as, say, the integrated circuit, we have to look beyond market philosophy.
Those are the places in which I see our failure: because we have become too market-driven, we have failed to keep the markets honest, and we have failed to achieve a game-changing innovation comparable to the integrated circuit since the Apollo program.
If we want to lead, we have to correct these two major failures first. Good governance is a prerequisite, and that means laissez-faire needs to remain an ideal, not something we try to enact into reality.
US Bank bailout package = $700B = 5% GDP
Germany bailout package = $671B = 23% GDP
No, we have not lost our superpower status.
We may be hardest hit, but we will be first to recover.
Others will follow us, we will lead the world out of crisis, as usual.
I just hope we can sell the manual…
Way to go Jim … I’m glad to see that the right wing is sticking to their philosophical guns instead of buying that cockamamie liberal notion that we have to work together to solve the problems that face us. I’d like to also hear your explation that this whole financial mess is the responsibility of the Clinton or Carter administrations.
We lost that status after the Democrats pushed NAFTA down our throats.And lets be honest, this bail out is all smoke and mirrors to protect the insiders. Why would some one without a job barrow more money from a bank ?. This is far from being over. I think the American people need to out source goverment. We can get the job done cheaper and have less problems.
We will only be a major player in the World financial markets when we also gain the respect of the World Powers. Our position in th World has and continues to suffer greatly. We shall see if out “new” leadership can distance us from the arrogance ad blind policies of the past.
Jim, I’m a liberal and I love my country, and although I’m aware of our economic troubles, I still believe that this country will remain a financial superpower. The USA is too important to the rest of the world to truly fail, when our banks feel pain, stocks around the world dip by 10%. I’m hopeful.
I think that will lose its position for several reasons
The first is because the government continuously forgets, better yet neglects to invest on important domestic issues.
Education is the big, the U.S. education K-12 is constantly lacking behind the rest of the developed world. Offering more kids trade school opportunities and making college education more affordable will give the bright minds an opportunity to utilize their talents and gifts.
Local infrastructure is vital to creating new jobs and improving cities around the country. There are many roads and bridges around the country that are not up to par that need to updated with new technology and safety requirements.
The second reason is because the U.S. always overstretches themselves and wants to help everybody (big brother) when it struggles to help itself first. This means, I hate to say, don’t invade countries without a legitimate reason (make sure evidence actually supports the reason, not an Iraq). Redistribute some of the Iraq funds to Afgahnistan and for domestic use. If they government doesn’t do this, it will follow the path of England, France, etc from generations ago.
I want to emphasize that the government needs to focus on the domestic issues before it takes care foreign issues. The country should be protected from “crazies” but not at the expense of our livelihoods. Invest and give tax breaks to companies that stay domestic and create jobs like alternative fuels, and in innovative technologies that the Asian labor market can’t compete in because their laborers don’t have the knowledge for (follow Germany on this one).
With the growth around the world, losing our financial superpower status was inevitable and happened long ago. It isn’t a bad thing, it is just fate. In economics it is known as the Catch-up Effect. We can’t sit alone at the top forever, and it shouldn’t be our goal to do so.
In my opinion, this crisis has changed nothing with respect to our financial standing or leadership. We will always be a strong influence, but we don’t make all the rules or control everything. What is happening now is the economy resetting itself after a bubble burst, and it is entirely normal for the economy to do so. The economy cooling off after a hot run is a painful process where people lose money, which is why everyone is freaking out. When the process is complete, the market will be back to it’s normal levels where it -should- have been during the bubble.
Company’s that do bad business will (and probably deserve to) get hurt. The only difference now is that those businesses are financial and everyone is crying because they are watching their 401k’s disappear. While severely unfortunate, this is the nature of the stock market. You may gain big or lose big. It is the privilege we pay for. If you don’t want to lose your money, tuck it under the mattress, but realize retirement may not be very easy.
In my opinion EU will lead world next years.Russia is getting EU.UK is losing pound (Brown yesterday was waitng out of the door the decisions of euroleaders).EU is becoming the new power.Nations and their 19th century idea is ended for ever.Now we have continents.Usa aren’t anymore in front of EU a superpower.Now we will face a very hard period (3-5 years)of crisis.Usa will have high inflaction and many problems for pay debts.World is in front a new declaretion for global economy and power.EU will lead this new world…all high policy and economy know this…..Thanks.
United states is going to be the most competitive market in the world. That part will remain for a long time. Some challengers are always good to make sure our competitivity is constantly being sharpened.
There is no superpower in the world. Stop taking things as granted. Do something to keep this market more competitive. Tax hike are definitely in the wrong direction, especially on the 5% of population who are creating competitive jobs.
This economic crisis has been like the typical car accident – it came from out of nowhere! We look for these declines in power to be immediately decisive rather than slow until finally we are no longer Rome. Our foreign policy has committed our military and leveraged our economy. Yes it is the old guns vs. butter cliche but no less relevant. While our nation’s military committments seemed another world away we leveraged ourselves with homes, vacations and cars we ordinarily could not afford. In America we and politicians like to say there is no such thing as a free lunch – let the dollar presses roll. Lunch is over!
I think that it will never if not for the next 25 years be the same. The emerging markets just got a lot closer to the top with all the other large nations dropping down a notch.
We will continue to loose our position for as long as we run budget deficits. As long as we as a nation and as individuals live more on borrowed money, the worse will be the next “margin call”. One solution is to, perhaps, give up ambitions and simply clean up the house, restore financial stability and fiscal responsibility. It is sad indeed that during recent economic growth the budget deficit grew only bigger. Shouldn’t the deficit be getting smaller when “things are good” and only increase in emergencies (like the most recent financial bailout)?
Good God! Does no one use this site except hare-brained liberals who have been drinking the Obama Koolaide and muttering the slogans as they sway back and forth with glazed eyes on the way to the polls?? Of course the USA will continue to be the world’s financial and military superpower–unless of course there are more of you defeatist, America-hating liberals out there than I think there are!!
the question is kinda outdated – these days everything is so interconnected and trans-national, there is no one nation that is a financial superpower before all others and that’s been true for some 30 years.
The US Consumer still makes the financial world go round and our GDP while decreased, will still be 1st or 2nd behind China. We are not going anywhere for a while. As you can see, if we go down, so goes the rest of the world.
The passage of the Sarbanes/Oxley law dictates that America is losing and will be second fiddle in the world of finance. Business has been moving to London and other exchanges and will continue to do so. There may be a place for bureaucracy, but the marching footsteps to London, et al
have already made it obvious, that America is no place for financial transactions. American bureaucrats for the most part, have refused to jail white collar crime and instead have given us Sarbanes/Oxley and other loads of bureaucracy that impede business. If you don’t believe it, ask those people that are headed for London and Singapore.
woodie williamson
We need to stabilize Wall Street and call a halt to what is nothing more than legalized gambling that is causing upheaval in government. Why should we be bothered by day-trading’s effects on the Dow Jones when nothing substantial can change in the course of one day for the largest enterprises other than the mere opinion of those same day traders?
They churn the market and cause gut reactions in politicians.
The politicians should fight back and 1) outlaw selling shares that one does not actually own by having closed a deal on those stocks – stocks in hand, essentially, 2) mandate a minimum holding period for stocks before being able to sell them without incurring a federal tax that is mandatory to withhold against any capital gains, with absolutely no loopholes – hold the stock for the minimum holding period, and you are not subject to immediate withholding of capital gains taxes on the sale. Those two simple measures should halt the wild swings in the market that are being caused by opportunistic gamblers who call themselves stock brokers.
People have lost faith in the stock market. They are no longer purchasing stocks for the dividends that companies pay but for the hoped for increase in stock value. Long term stockholders are not being rewarded for holding their stock, but only the gamblers masquerading as stock brokers, engaged in legalized gambling that is hurting our economy.
I think we should let economists answer this with the numbers, statistics, and education they have. Not the people who report the news,and definitely not the people who read the news.
A Pledge for Our Times (2008)
I plead collusion to the fraud of the United Socialist States of Amnesia and to the recession for which it stands, one Notion under Debt, unforgiveable, with sub-primes and bailouts for All.
I believe we have already lost the financial superpower.
This started a really long time ago, when American’s lost there jobs and they began making everything in other countries. When was the last time you saw something that said “MADE IN THE USA”.
We need to bring the jobs back to America.
There is NO MORE middle class in America either your super rich, or poor to Super poor.
US is notoriously famous for people who don’t care about others with
extreme narcissit traits. They have no clue what is going on around the world. Their personal achievements, happiness, wealth, luxury is what they look for. All the above have contributed as a whole. Why else would a $50,000 gross income family buy a $300,000 house? Does that make sense? Do they even think if they can afford if something were to happen to their job? On the financial side, the team/bank/person responsible for approving these loans are to be blamed as well. Again the banks interest and personal interest like “bonuses” played a major role in such approvals.
Why would a 5 feet, 120 lb single driving person drive a Suburban, big fat SUV, or Ford/Dodge 8 cylinder vehicle?
Think about it America….Think about it.
We are at risk of losing our status. There is no doubt about it. However, if we take action now and get our fiscal house in order including cleaning out public debt and our private irresponsible debts, we can save our position.
We survived the great depression. a simple recession only means more opportunity. We will grow stonger and be become an even greater envy any nation has ever known.
our financial strenght is so strong, that when we wobbal. the rest of the free world begins to crumble.
Too late, we are a lame duck super power at this point and only holding on through military might and sheer ego.
Tax Cuts, Tax Cuts and more Tax Cuts; Free Market, Free Market Free Market
These are two Rally Cries we are hearing currently.
Question: what will happen when the countries of the world and/or US Banks request US Treasury Notes be a Pound/Yen/EURO/Dollar ratio? That will put the free US government under the free market. What will be the net effect of these two Rally Cries if they become reality? Do we want to be the world’s financial superpower?
The whole world usually relies on US consumption in order to grow their economy. Now they realize that unless we have fiscal discipline, they will change their future growth not relying on US that much.
Many of us talk about how the US or people in US are to blame for the crises. Keep in mind, every citizen of a country who has bought materialistics things to satify his/her needs is responsible for the crises. Wants and greed have superseeded needs resulting in the crises.
The dollar will probably remain the currency for most systems, only because of logistical concerns. It would be too costly for most all leading countries to change. A lot of countries, including China, are invested in dollars. However, I don’t think any of the big players think the US is a financial superpower. There are several countries that could wipe out our monetary system overnight. These countries might get upset if the Federal Reserve continues to devalue their investment by printing money out of thin air. If China floods the markets with the T bills they own, the US dollar is worthless. Saudi Arabia decides to accept Euros for oil instead of Dollars, it wipes out our monetary system. The best way to maintain our status is to return to the gold standard, and dissolve the Federal Reserve. This probably wont happen, since the last president to suggest this was assassinated. But the Fed should play very conservatively, and quit trying to control the markets, or we are in trouble. This whole run on the banks was the Fed’s fault. After they took over Fannie May and Freddie Mac, the stock lost about 90% of its value. What investor in their right mind would invest in another bank if there is a chance the Fed will take it over and devalue the stock? If there is a chance a bank is going to need a bailout, investors should pull their money before it happens. This is completely the Fed’s fault for mismanaging the situation. And it will be the Fed’s fault when our dollar is devalued.
Yes, We loose our position in the world’s financial superpower… But also loose our Military superpower as well… Because a country without financial stability will not able to afford maintaining strong military.
The dollar will probably remain the currency for most systems, only because of logistical concerns. It would be too costly for most all leading countries to change. A lot of countries, including China, are invested in dollars. However, I don’t think any of the big players think the US is a financial superpower. There are several countries that could wipe out our monetary system overnight. These countries might get upset if the Federal Reserve continues to devalue their investment by printing money out of thin air. If China floods the markets with the T bills they own, the US dollar is worthless. Saudi Arabia decides to accept Euros for oil instead of Dollars, it wipes out our monetary system. The best way to maintain our status is to return to the gold standard, and dissolve the Federal Reserve. This probably wont happen, since the last president to suggest this was assassinated. But the Fed should play very conservatively, and quit trying to control the markets, or we are in trouble. This whole run on the banks was the Fed’s fault. After they took over Fannie May and Freddie Mac, the stock lost about 90% of its value. What investor in their right mind would invest in another bank if there is a chance the Fed will take it over and devalue the stock? If there is a chance a bank is going to need a bailout, investors should pull their money before it happens. This is completely the Fed’s fault for mismanaging the situation. And it will be the Fed’s fault when our dollar is devalued.
Its funny to listen to the self righteous give their 2 cents worth. Humans are the same no matter where they come from or what flag they salute. We are opportunist by nature. Any group of people or governments would do the same thing if given indentical circumstances. No one has a crystal ball and no one can predict the future. We do what we can with what we have. Yes some will take advantage. Wether the US has or will loose its finanacial super power status is a no brainer. Ofcourse they will… eventually. No one can hold the torch forever. Will they remain competitive in the world market you better beleive it. Its the very basis of the US economy. There will be set backs for any country but in the World will always look to the US for her input.
if we do lose our status, it won’t be due to lack of govt intervention, but because of it. would we be $6 trillion in debt if we hadn’t created social security and medicare/medicaid? would people be in homes they couldn’t afford if the govt had backed the loans? our consumerist culture is propped up by our intervening govt telling everyone it will be okay. we all deserve a house, bmw, and big screen tv, but we don’t. you have to work for it. if a life boat takes on everyone, the whole boat sinks. is that fair?
Daniel from Denver said:
“When Rome fell, it ushered in the Dark Ages”
Well, if we learn our lessons from the fall of Rome, perhaps now is a good time to let America fail, because the time when it could drag the whole world with it is well past.
George W. Bush made sure of that.
Saving the American paradigm would only prolong its agony. So, maybe it’s better to let it implode so that a new and, one hopes, better society can be built?
I do not think right away. Nuclear deterrent was prevented by assured mutual destruction. We are now in a “economic” deterrent. Countries refusing to finance the US will assure there own destruction. If a country is export driven, then there must be a country that is net import to drive the equation back to null.
We lost our “superpower” status a long time ago, when we got to the point of 2/3 of our economy being fueled by consumer spending, and the vast majority of that being deficit spending on their part fueled by home equity loans. A significant portion of the US will quickly be bankrupt, because the credit-market clamp-down will force them to live on their incomes alone. Even with two incomes, it won’t be enough – and the result is going to be a huge collapse in consumer spending. Expect to see the collapse of a lot of the “big box” stores who have been fueling the spend-o-rama in the US. Ditto any firm connected with new home construction. Anyone buying a home in the US will be buying from our immense foreclosure stock for the foreseeable future. Anyone who doesn’t will be clearly a fiscal illiterate.
WE HAVE ALREADY LOST, THE CHINESE ARE COMING , WAKE UP AMERICA ITS A LOST FINANCIAL WAR, UNLESS WE CAN REALLY BUY ALL OUR DEBT BACK, WITHOUT JUST PRINTING UP NEW MONEY.
I agree 100% with First Hand from Huron, Ohio. Very well said, sir! This financial crisis is the culmination of America’s spendthrift culture from Main Street to Wall Street. “A fool (or fools in this case) and his money are soon parted.” This proverb typifies what is happening to the US. We are all to blame and unless we, as a country, change, the US will fall behind the rest of the world as a financial superpower.
THE REASON WE WILL NOT LOOSE OUR SUPER
FINANCIAL POWER IS BECAUSE THE WORLD IS REALLY LINKED AS ONE, AND ALL COUNTRIES ARE INVESTED IN AMERICA, SO IF WE LOOSE THE WORLD LOOSES. TOO MUCH OF THE REST OF THE WORLD OWNS IN AMERICA. WE’VE REALLY LOST OURSELVES.
We are all talking about how bad we have done, we are talking about it after damage was done. Let us speak in one voice and make sure we can stop more mess. We have infrastructure and we have power to succsseed. A leader is no more a leader when there is a replacement. We can replace our own selves by being a better more responsible super power.
I’d say no, for the following reasons:
-Currently, the US is too ideologically wedded to an extreme form of capitalism and its own exceptionalsm. Neither is very powerful, applicable or relevant in today’s world. Rigid ideology, and expenditures of ever greater resources to maintain a status quo is a prescription for failure – just ask the former Soviet Union or today’s Nort Korea or Cuba. Unfortunately, the Cold War and irrational fear of anything that smells like socialism have turned the US into an eventual failed state that’s at present is coasting on its past industrial strengths. The natinal debt of 10 trillion alone should give anyone doubts about US’ long-term viability.
-the US no longer has a critical mass of hunger for success [ and even its definition of success is a rigid and narrow-minded one], and homegrown intelligence, as it were. [clear evidence of that can also be found among the majority of posters here]
It has neglected its public education for far too long and has no longer has a culture of investment in its own people, preferring to conduct periodic labor input replacement therapy through immigration and outsourcing policies.
-While majority of Americans believe that because the world listens to rap, eats at McDonalds, and watches American movies the world wants to be like the Americans. Nothing could be further from the truth. The world also buys Swedish vacuum cleaners, Italian shoes, German cars, and Japanese electronics and that it doesn’t mean it wants to be German, Italian or Japanese.
The world likes some American stuff as acoutrements, life’s tassels, so to speak, but vast majority of the
world would prefer to live their own lives, not American ones.
Who could have pumped a trillion bucks into their economy to keep it going? Well, it is the world that is saving us, this is all borrowed dollars that you, your grand children and 20 generations to come will have to pay back? Our buck is flying high because, for a lack of a better term, the US Gov needs to secure this currency somewhere if not everywhere thereby increasing the value temporarily. Once the dust settles from our great trillion dollar buyout to Wall Street our buck will be worth less than Peso. We can not afford to keep running deficits, people the debt load doubled in 8 short years. Wealthiest per capita are you serious? Debt does not constitute wealth. Wow my fellow Americans really…President Clinton on November 4th…
If we keep buying foreign products, oil
automobile, instead of investing in america we will loose.Real americans buy american, GMC,FORD,CHRYSLER-Be a real American we do make good products.
We need to start being serious and not greedy spoiled brats.
We may well lose our status as #1…unless we can unite again as a country…and that will never happen when our candidates for the highest office continue to divide the country along party lines with name-calling, slander and innuendo. The red-state/blue state “party first” mentality of US politics does not serve the citizens as a whole, rather it promotes only the most vocal special interests and radical fringe…on both sides. We still have a chance, but every time a columnist or blogger rants… “Facist” … “Socialist”… slyly slips in racist or sexist remarks… or a candidate lies to his base to create a frenzy, then quietly says..”That’s not what I REALLY meant”…we drive the wedge deeper and deeper. Eventually the 2 halves will no longer make a whole.
The U.S. agreed to become part of the global economy years ago. When this happend I shuttered because when you are the wealthiest nation in the world there is only one way to go…down. It is the leveling of the economic playing field. I ask if we were just that nieve to think by joining the global economy we would somehow keep our place on the top without a downfall? My answer is of course not! It is the way the global economy works and unfortunatly we only had one way to go…down.
This has been a crisis of political leadership all along…the market collapse was only a matter of time. Entitlement thinking permeates our culture, starting with public education and running through buying habits. Undereducated and uninformed, we are witness to a generation of people who live and spend for today. The politicians serve up what they must to remain in power. Our system is in decline and we as a country will gradually over the coming 20-30 years backslide to mediocrity.
Mr Ron, we Europeans are not at all happy about the economic environment in the US. We know that if your economy is going well it’s a good push for our economy to go well too and to see the end of the tunnel. I think you’d better worry about China that holds a great amount of US debts than Europeans which has always backed you up.
Not necessarily yet, but in the medium talk, surely. It’s inevitable. The 20th Century was the U.S., the 19th arguably belonged to U.K.. Further back saw many ‘changing of the guard’
periods in economic dominance. Greece, Spain, Rome, Egypt, China, Mongoila (1 in 5 of us carry the Genghis Khan gene!) to name a few were arguably dominant in some form or other and each of those peoples would never have imagined that 100yrs on, they would not be the force they currently were. So when it’s 2108 who will be the one? Choose from China, India, Russia are the obvious candidates but if Malthusian population
issues begin to impact then Brazil, with it’s massive freshwater and agricultural resources, might be a less obvious runner.
Yes, because we spend too much on “guns” and not enough on “butter” as economists would put it. Every financial superpower before us has fallen because of military “overstretch”. “The Rise and Fall of the Great Powers” written by Paul Kennedy and first published in 1987, not only chronicles this pattern throughout history but predicted the fall of Soviet Union, the relative decline of the US and the rise of China as the world’s next dominant superpower based on this simple premise….
The superpower economic status of the US has been lost long ago. We qare thr most profligate debtors in the history of the world. This financial crisis is simply exposing what has been there all along hiding under the rug. The rug is now removed and the sight isn’t pretty- a dead broke nation with little self control to do the right things. The right things include a downsizing of governemt and all its programs to affordable levels.
The US economy is resilient and can come back. But if it is left the way it is right and the people in this land (not just wall street but main street) reevaluate how resources are being utilized then it will be catastrophic. But we pray it will not come to that. Hope the greediness on Wall Street and Main street can be tamed.
USA has become a service economy. To wit, over 50% of the population work for the government and therefore the costs of their labor are not able to be controlled. Then there are the private sector jobs in the service industry. We are not producing much and thus have become a mature or dying economy.We have seen growth of the service sector feeding upon itself. That growth is about to reverse itself. Boomers are retiring- becoming one car families. Nikes will be replaced by New Balance, or even Keds, like the old days. Credit cards are maxed out. The American greed will need to recondition itself to having less. Government will need to shrink and manufacturing needs to grow again. That means a reversion to the old ethics of the workplace. As government shrinks, small businesses will grow, replacing the behamoths that have been milked dry by greedy senior management and rehydrated with taxpayer money. IT IS UP TO EACH AMERICAN TO START ANEW.
The problem is, the government do not like to let the markets fail down. Failure and success is part of life. This turns out the US to be the biggest socialist community in the world but if socialism explains the real life facts why it failed down? So we may conclude that the path being followed by leads to a perfect failure while trying to save the day. 2008 might be remembered by many of its aspects in the future but the most spectacular point will be the failure of capitalism which is led by US Free Market norms as a result the failure of US superpower on the earth. Some may thought it is good, some may feel pain but we should accept the reality as what it is.
Quote from “Rational Mind”
Yes, just look at how the american bank are rescued by the japanese / chinese / singapoorean / arab world funds. And think about who’s helping americans out, it’s the chinese and japanese buying your treasuries to keep the country from being bankrupt
I have news for you. We’ve been bankrupt/insolvent for years.
First of all i just want to say that the reason the market is the way it is today is because of all the greedy big fishes who hand out 6-8 figure bonuses out to themselves and to there fellow workers who do nothing to try to prevent the market from going south, whiles they use their money to become more rich and not even think about the economy. I think that everyone is becoming to greedy in the corporate world and it’s causing America’s economy to blow up in our faces like a ticking time bomb. Yes i strongly think America will lose their financial superpower because everyone is now going to criticize us on the way they have to lend us money so that the rich people in America don’t have to come out of there’s.
What make you think we are the world financial superpower. ie China, Japan
SU, We are 10 trillion in debt.
During recent decade lots have gone wrong in USA:
In business shortsighted & ambitious Topmanagers forgot their commitments
towards society;
Overambitious politicians have taken wrong decisions on wrong moments.
The United States have lost a lot of credibility and we all will suffer !
I feel ashamed about human behaviour.
Cees van der Wal,
Zoersel (Belgium)
“No welfare state in the world has ever been a superpower.”
Uh… Jimmy, what do you think the Soviet Union was?
America will only save it’s position as a superpower if we earn it and keep earning it. You can look at all of the problems that we face and it all comes down to greed both by the bankers and all of the people. The Bankers are nothing more than an extension of the people who want everything now and went on a credit binge. No one saves anymore and are penalized by taxes and inflation if we do. We got to be number one by hard work and immigrants coming to this country that made sacrifices and a country unified. Look at the country now, does New York care about California, does Florida care about what goes on in Oregon, do the small towns in Texas know anything about the world other than who their football team plays and if they goes to regionals maybe they will find out where the road goes. Great problems bring the country together for a while like WW2 ot 9/11 but then it’s back to business as usual. We are facing another great problem, can we handle it? Can we build a power grid and become energy sufficient, can we even grow a salad in the winter to feed ourselves. What good do all of the inventions and inovations that we came up with if we can’t even be self sufficient. All of the energy we use is caused by the sun both now and the past, even oil and coal. If we learn to use the sun wisely and band together we can make it. There have always been business men, doctors, rich people and of course peasants and serfs and so it will be in the future. You can’t make all people the same so get over it and use the assets of all of the people that can contribute help the country.
Will we eventually lose our “top dog” status? Yes, but not any time soon. It would be a fool’s errand to believe the US will be on top for infinity.
Adding to what Matt said below – we need to get social security under control as well as health care. My solution would be to abolish the program congress (our version of royalty) gets and force them into the common man’s (peasant’s) retirement program. Then and only then will real change happen.
It will be a long, slow crumbling decline, like many previous empires. But there’s no question we’ve been on the downslope for at least the past 7 years.
Mr. Soros is a famous economist who has made billions in the market. He elaborated this weekend on CNN that this crisis has its roots during the beginning of the Reagan Administration. This is when Reaganomics had its roots. This is also the time when this country went on a binge of cutting taxes and huge budget deficits. This broought in the new era of budget deficits and high consumer debt the likes we had never seen before. Everyone likes tp think of Ronald Reagan as the great communicator and I thinknwe all liked him immesnelu but he was no economist and his plan literally took us to the brink of financial destruction.
Mr. Soros also stated that we are in for a prolonged deep recession and a recovery period the likes we have not seen in 50 years. The days of wine and roses are over for America. He added in the end that we had better understand that the US Government provides essential services and that those services have to be paid for with taxes. No more deficit spending as the rest of the world is no longer flush with easy money and will not fund our excesses any longer. Better go out and by that last BMW because this will be the last hurrah.
Sorry but we have been living a life of ooutsized luxury wihout any means of paying for it.
Rick in San Diego
I think Usa aren’t anymore a superpwer since several years.They are in the hands of EU and ather countries because their debts it’s too huge.At the end of this crisis Usa (but also now ) will have a very lower weight in the world.This crisis is long and many Us societies will fail (GM,Ford,MS,GS,Nasdaq societies…and many other that nobody think now…).The world stock exchanges rebounded today becouse of EU decisions.In EU there are panic selling and problems linked at Us financial products.In Usa there is a huge problem:public and private debts.They have to be payed and Usa are very very far from this.To pay these debts Usa are printing many $ that are losing importance.Also Army is owned by other powers…imagine that the 50% of your carriers are owned by EU or China.They have weapons like Usa…It’s a joke talking about Usa superpower!
Yes the US will loose its superpower status, the american markets will noose dive 7K under by 2010.. the US treasury remains bankrupt with a secondary loan bail out plan from the EU will send EU in a crisis.. The true estimated loss remains to be around 5 trillion in cash by 4th quarter of 2009. Asia needs to think and move in for common yen based trade to grow.
The “Dollar Trench ” shall continue till 2013.. The Superpower will be renamed twice by 2018.
The dollar still rules the base of the pillar. Maybe others can “de-couple” for the dollar but what we have seen in the past week is that from the Kremlin to Dubai to Hong Kong, the system is based on the viability of the United States; the principles that govern the global economy. When Rome fell, it ushered in the Dark Ages. If this is the case now, no one wins.
And, to all who blame the democrats for bailout to Subprime, please, go to http://www.Whitehouse.gov and see who the sitting president is and who owned the congress for 14 of the past 16 years. Take responsibility for once; your ignorance is killing this country!!
Yes, we brought financial ruin to ourself by attacking Iraq. The $700B baitout is about the cost of the Iraq war.
All past superpower such as Spain, Portugal, British empire, Japan & now USA share the same financial ruin by attacking other countries.
You betcha. Just because we are a bunch of boneheads doesn’t mean other countries have to be, they are going to distance themselves as much as they possibly can over the next couple of decades. Who can blame them? People don’t want a bunch of greedy idiots playing roulette with their well being and future.
It has already lost it.
The US came up with a plan, including the bailout and the market had the worst week in a long time with the Dow goes down to the 8000’s alomng with worldwide markets
The Eurogroup meets without the US , presents their plan and inmediately the Dow along with all the mrkets starts going up!
That says it all…
No confidence in the US anymore…
Europe and Asia are the future..
We stopped being the World’s financial super power a long time ago. Dollar by dollar our country has been sold to foreign investors over a long period of time. Meanwhile, the American public has been more concerned about who is going to win the next Superbowl and who will take home the Oscars. This country is so distracted with junk that doesn’t matter, it’s a shame, but it may be too late to keep the worst from happening. We don’t have to worry about enemies attacking us. All they need to do is buy us out and, so far, he that controls the oil controls the US.
Yes, if we do not reverse our debt position
Our $10 trillion debt is a millstone around our necks, currently costing 9% of our TOTAL NATIONAL BUDGET
We need to pay down and eventually pay off our debt to secure any financial future
For the foreseable future I would say no, the USA will not lose it’s status as “world’s financial superpower.” Simply because 1) the term is ridculous. And 2) There isn’t anyone to replace the USA. At least not at this time. Unfortunately, there aren’t as many creative, innovative, driven Americans as there once were. The culture in the USA stinks of laziness, selfishness, overindulgence, and an over fascination with pop culture, etc… If the USA culture remains this way, it is only a matter of time before someone does surpass her. Who could it be? It seems as a culture rises it’s offspring kills it off. Everyone seems to think China, but I wouldn’t be surpised if it was someone else. Have a nice day!
The United States is no longer the economic super-power we once were.
We are, in fact, a debtor nation. Through financial mismanagement, the current Admisistration has doubled our National Debt in only 8 years. To address this financial crisis, we may well need financial assistance from the “wealthy nations” such as Japan, China, and Russia.
That is the stark reality of our current situation. And, it will take time and be painful to correct.
Yes. All superpowers have historically lost their position. When and how long will the decline take? That is a different question. To delay loosing the advantage, the country has to go back to basics, which is to create (invent, manufacture) goods and services and sell them at a profit.
Imho, democracy is a great tool for our goverment. However exporting democracy (going to preemptive wars to spread democracy) does not qualify as a neither a good nor service, so stay away from this business! Invest in our children’s education. There are plenty of very tough challenges to solve in our world, so equip our kids with the best tools to fix them and market their solutions.
God, I hope so. Not, because I wish for such a demise, I am as red blooded as anyone, But it has become tiresome reading these blogs and the complaints about how America is to blame for everything, these “It’s about time” repsonses. I say fine, let’s revert back to our pre-WWII isolationistic mandate. Tidal wave in Indonesia? Don’t ask us for help. You guys should have taken surfing lessons and made it a party. Taliban executing innocent women in your village? Good luck with that. Moscow has turned off the pipeline providing the heat to your house? Brrr, we suggest putting on another sweater. North Korea is nuking southeast Asia? Ouch. We would like to intervene, but we really don’t want to upset anyone…American generosity has just left the building.
No, because no one in massive debt has power. We have borrowed our way into the abyss and will forever be at the mercy of our lenders…China, Japan, the Saudis.
Our entire culture is a facade. 80% of this country are wannabes. the $30k a year millionaires will soon be flushed out.
Yes of the US will retaind that status. The dollars inspite of all the turmoil least actually rose against other currency. The world trusts us with thier money. The question is can trust ourselves withour money. Credit cards are the loan sharks of the last 30 years. The financial markets are paying prive for excessive loans. They will return to basics and start loaning money again. If you were narrow minded enough to let your house forclose or stopped paying your bills you will not get to brrow money without siognificant interest rates. As far zero dwon forget about it. It will be like the 70s
Yes, we might very well lose our financial superpower status. Maybe that would be a good thing. Maybe we could just return to being a humble republic that seeks to mind its own business, trade with the rest of the world, and adopt a sound money standard again. If anything good should come out of this mess, hopefully it will be the complete discrediting of the Federal Reserve fiat monetary system that got us into this mess.
When in Rome! Do you think the romans standing in the forum in around 400 A.D. or so thought they were witnessing the fall of their great empire? “Of course not. We’re the greatest nation in the world”. The fall of Rome was gradual and it officially fell in 486 A.D.
Those that don’t learn from history are doomed to repeat it.
“One of the primary catalysts to the deterioration of the economy was the lack of circulating currency in the Western Empire. Two reasons for the lack of funds are wholesale hoarding of bullion by Roman citizens, and the widespread looting of the Roman treasury by the ‘barbarians’. These two factors, coupled with the massive trade deficit with Eastern Regions of the Empire served to stifle the growth of wealth in the west.”~
Sound familiar? So to think we can’t change this is crazy, but we need to actually change this.
I think that the US will take a beating, but investors will return once the government steps in and rights everything. The reason investors flock here is that our economy is usually quite sound but we have one of the freest markets in the World. China, Russia and India might be fast growing places to do business, but their governments leave much to be desired. And Europe is over-regulated.
Globalization is becoming more and more present every day, and I think as economies become more interconnected, it will be hard to see any one area as a “superpower”.
Have any of you “We’ll stay on top because the USA is the greatest and freeest place on earth” commenters ever been outside the US? Cruise ships and resorts like Cancun don’t count.
Now is not the time to lament, but to get back into the market and ride the wave upward. 20 to 30 years from now you, and everyone else, will marvel att the largess of your holdings.
Finances have behind productive work such as creating goods, intellectual property and services. You cannot continue to print more dollars without putting real value behind. Since US outsources real work including medical and lawyer services overseas US Financial Status will go under, and who produces most real value will be next superpower.
We are done! I love reading some of the misinformed comments below about how we need to get consumer spending up. Real GDP growth can’t be driven by consumer spending, only production. Other people have talked about how other nations are trying to destroy us?!? They are buying our debt because we are trying to sell it to them! How bout those folks that talk about America’s unmatched property rights. What property rights? If you don’t pay property tax, your land is confiscated. The govt always has a claim to your land. Anf if govt decides your land will generate more tax dollars in someone else’s hands, they can take it from you and give it to another party. (See Kelo vs. New London)
We have very few of the freedoms that our Founding Fathers gave us. They must be rolling in their graves.
If you want to see the future of the US, read Peter Schiff’s book. He called everything that is happening right now back in ‘06!
We are a superpower debtor nation. The world needs our markets, but they will need them less over time. One certainty, though. Unless we begin to live within our means, the world will lose interest in investing in our debt, which will be seen as too risky.
YES. Don’t people realize that Japan and other foreign countries are now part owners of our financial institutions? We had to sell ourself to them. Just look today at Morgan Stanley. That means that when we get out of this ditch the profits will be sent to Japan, China and Europe. THEY OWN OUR FINANCIAL INSTITUTIONS!!!
The US can remain a financial superpower for a long time to come……if we learn two vital lessons. Exporting trillions of $ annually for war and expendable assets like oil and manufactured goods that last only a few years is childlike foolishness. That money goes up in smoke and into the dump. Allowing people to default on loans while retaining all other assets gives the unscrupulous a license to steal. Quit looking for villians – behavior change is required by all of us.
I knew the U.S. would not remain a financial superpower when it elected Bush… twice.
Reminds me of the those big mega millions lottery winners. They got it all and somehow managed to squander it all.
I’m not disappointed in Bush. I expected it. I’m disappointed in the American people who voted for him; not once, but twice. We must be gluttons for punishment because McCain and his Bush policies have a lot of support.
Yes for sure………
A country can not see much of a progress when its focus is an ‘unwanted’, ‘unnecessary’ & ‘meaningless’ war.
I think eventually we lose our position as financial superpower because countries like India and China are making trmendous progress. It is just matter of time when they overtake us.
Who is helping the Americans out. China would be nowhere if we weren’t buying the goods they make. You have to ask how they can make things so cheap, and how we as Americans can purchase from them and then feel self-righteous about helping other countries. We have to get back to living within our means, stop all the importing, or at least tax the imports enough to be able to pay for our own job loss, and prioritize our goals–like making our own energy. It seems so easy to see so many things messed up. To blame it on democrats or republicans alone is not a help– it is the same self-righteous attitude that got us in this mess. P.S. — It is cease to exist, not seize.
Nobody needs to wait for Democrats to get elected for socialism to arrive in America; it’s already here.
The Republicans increased socialism today; bail outs to Investment firms, Freddy Mac, Fannie Mae, Bank, Airline industry, Automobile industry, dairy farmers through price supports, and on and on.
Only different is Republicans like to privatize profits and socialize losses.
Yes, USA will no longer be the financial superpower, Since now we just learned that “Cash is King”, And Greed is the source of our country corruption. We have given our seats to China… Furthermore, In order to fix our country; before total devastation. we are becoming a socialist country ourselves(govt bailout). And China is quietly laughting to the bank.
I’m afraid not, first we must find a way to successfully run our own country before we can reach that plateau. Because of our leadership or lack of it, has put us in this tedious unformilar position. It may years to earn back the respect that we have lost in the world.
Go on the internet and look up countries based on their GDP. We far exceed any other nation in the world based on productivity, standard of living, military might, medical advances, R&D, etc. While we are in difficult times, we will remain a country that the rest of the world emulates.
USA is now a state capitalistic financial superpower. Just like Soviet Union was a state socialistic military superpower. Both ruled by arrogant and distant bureaucracy. And citizens mercilessly subjected to the will of state elite interests. How sad concerning the high ideals of the Grounding Fathers! So very sad!
I think it’s possible unless we sell gold reserves to buy the foreclosures-then buy back the gold at a later date when the price is down
Do any of you people think about what you’re posting? All this rah-rah, divisive, moralistic claptrap is making me want to hurl.
We’re either going to lead, or we’re going to fall into line behind someone else. If we want to lead, we have to take of our economic dogma blinders and look with open eyes at what works. It would be stupid to abandon market economics altogether, and it would be stupid to pretend there hasn’t been a failure and go back to business-as-if-usual.
Emotional rants have no function in real policy debates. Save it for your marketing presentations.
Looks like it but does it really matter? It is now a global economy, not just one nation leading the rest. Tough sledding ahead for the US but the last few years and specifically the last few months have awaken American’s senses to live in a global reality. The stupidity of vanity, keeping up with the joneses, etc will be replaced with a new generation of savers and economically minded citizens. At least that is the hope for our future. With Fed regulation and a more responsible private sector, we can reclaim our super-power status. The other reform will come in the way of American Citizens starting to buy domestic. The realization that buying products from China, which are lower in quality or tainted with harmful ingredients will provide the stimulus for how Americans think about their buying habits. Dollars go towards US made goods; America will pressure the Wal-marts, Targets, etc to scale back on Chinese, Indian or other imported goods. Our Fed cannot keep up with the policing responsibilities of looking at every product that makes it to our market. Give it about 10 years and we should be back. But that’s OK. These things take time.
I think if we the US don’t reevaluate our foreign policy and cut spending overseas, we will have an incredible time trying to undo the tarnish of what we’ve allowed ourselves to accept. This world revolves around money and unless our foreign policy is addressed we will continue the path of jeopardizing our national sovereignty and the needs of the American middle class working families that are here legally.
Conservative vs Liberal is not the question. It’s realy more about those with lots of money want all the money. The USA is the place to play the money game because you don’t need an invitation.
It depends on how gullible foreigners are. Will they still give us credit to buy consumer goods from China? Will they still give us credit to import oil? Will they still buy our treasury bills? Will the still buy AAA-rated financial products from Wall Street? Will they still finance 6% of our GDP through the trade deficit alone so we can live beyond our means?
Personally I would answer NO to all of the above, but then again I am no gullible foreigner.
On another note, the level of denial is just remarkable “No other country has the rule of law and property rights we have”
Indeed, if we had rule of law in this country we wouldn’t be in the current dilemma and many Wall Street CEOs would be parading in orange jump suits.
Yes, just look at how the american bank are rescued by the japanese / chinese / singapoorean / arab world funds. And think about who’s helping americans out, it’s the chinese and japanese buying your treasuries to keep the country from being bankrupt
I would say NO, because once we have a socialist president residing over our current socialist Congress, our country as we knew it will seize to exist. Get ready for govt to be in everyone’s back pocket. No welfare state in the world has ever been a superpower. I plan to go on welfare once the democrats rule the roost.
Superpowers have their day in the sun, then it sets. It’s the same with previous world powers, and it’s not something the US should be ashamed of, if they admit this fact. This is the nature of economics, the only question is when?
If you believe the maxim “No free lunches” as the basis of capitalist economy then it is the rest of the world which is paying for American bailout. The bailout is a big canard bcoz it is not accompanied by increase in production of goods and services. Bottomline its going to contribute to global inflation and augument the already existing bubble and bcoz America has current account deficit so the rest of the world is paying for it anyway.
Another thing Americans have too much into the death of decoupling theory. China and India might have shed 2-3% growth rate but both still have growth rates above 8%. The fall of their capital markets (which is not representative of their real economy in any case) essentially was bcoz foreign investors ran away with their dollars. but no bank downed shutters noone went bankrupt. Their savings rate is still above 30% and their economies are still not producing bad loans. Need one say more about the winner here.
no doubt. the europeans are happy now because we are in the state we are in but there is no doubt that in time, the USA will come out of this on top and the europeans will come begging for our help once again
US economy is the envy of the world,is based on our founding father’s principles of protecting the rights of minorities,and rewarding ingenuity and hard work.Rule of law still prevails here,most other countries don’t. Ask any one in the world which country they prefer to live,it’s USA.We just need a fiscally responsible congress.
Not as long as Pelosi and Harry Reid and Barney Frank and Chris Dodd are running things. THese clowns should be put in prison for what they are doing to our country. They are self-serving hypocrits who dont give a damn about the people. Throw Cornyn, texas senator in there too.
Ownership rights, voting freedoms, opportunities, rewards, hard work, innovation, education. All reasons the USA will stay in place. It’s going to be a challenge, and we will always have lessons to learn- and you bet, some will be painful. But yes, if we continue to cooperate on a global basis, we will survive the test.
I think ol’ Waldo is a bit jealous, or insecure.
I dont think Borrowers or with debts are Financial Super powers. Only Lenders like India and China etc who save money and use them wisely are Super powers!
Thanks Bill, it is good to know that our prospectives are the same between North and South of what used to be the UNITED States of A free America…
The question now is, my fellow Americans, I’m angry and upset, not because I’m loosing my money, I’m no rich Senator’s son, rather I’m angry because I know “we the people” are loosing something of far greater in value. We are loosing our freedom and liberty! We have to stand up to this, “We The People” are being robbed by our own government, every member of Congress, every judge, every elected official whether local, state, or federal as taken an oath to uphold the US Constitution. They have broken this solemn oath. We only have one shot now and that is on Election Day November 4th 2008. We must vote for a new party, a party who is not connected to what should be clear to every American citizen, the Democrats and the Republican parties are nothing more than organized criminal gangs. We need a third party who can come in, appoint a special prosecutor, and begin to bring all of these criminals to justice. When Enron and WorldCom went bust. The people responsible were arrested and charged, and put into prison. Who is being charged for our currently situation? But what will the voters do? Will they vote for the same guys again? Obama? Mc Cain? If you what change, then you will have to change your vote, NO Democrats, NO Republicans, and most of all NO INCUMBANTS WHO VOTED FOR WALL STREET OVER THE AMERICAN CITIZEN!
Well, the first step in our decline of a Super Power was Washington letting our manufacturing go overseas. This is not free trade, it’s , letting China and India steal all our manufacturing jobs. Everything is made in China now so we have no manufacturing to put ourselves back to being a financial superpower. We will pay in the end for our lack of protection from bad trade deals.
Well we have the largest economy in the world, the US economy is almost 3x as big as the next largest on the list. The state of California alone is the sixth largest economy in the world. My guess is no, the United States will not loose is status as the world’s financial superpower.
The only powers who have a chance of taking the lead of hegemon. Would have to be the EU. China at this pretty much only produces products in which US companies have being produced there for the most part. Russia is to based off selling arms and oil production. The only power that has strength would be the EU. Although there Military strength isn’t even close to challenging the Us. So pretty much the Us will lead for the foreseeable future. TADA
Yes, and good riddance to the position. The process has begun but will take years to complete. The U.S. will still be very influential in the world ‘morally’ (rightly or wrongly), politically, and in terms of financial policy. We will just no longer have the artificial burden of pretending that we have all the answers. The U.S. can now say to the rest of the world (from Elvis Costello lyrics):
Now it’s my turn to talk and your turn to think
Your turn to buy and my turn to drink
Your turn to cry and my turn to sink down in the Blue Chair
There i no way that the United Staes will loose its position as the worlds’s financial power. This is because as we saw last week, the european and japanese and all other countries were trying make the US fall, but as they saw if you make the us economy fall so will yours and it happened. It was not only US issue but a global issue. Also as we see the dollar is also rallying since many investors are buying treasuries. Within a few moths the dollar shall be the strogest currency.I think the worst is over and right now if you have money, it is the best time to invest.
IF US SNEEZES ENTIRE WORLDCATCHES COLD. RECENT DEVELOPMENTS HAVE SHOWN THAT DOLLAR IS THE CURRENCY. SO FROM NOW ONWARDS IF US SNEEZES ENTIRE WORLD WILL GET A FLU.
We lost our credibility and that’s going to hurt us. I still can’t believe the government let it get this bad before doing much. Until this summer, they were telling us that we were solid. I blame the Bush administration, the current congress (both parties), and Mr. Paulson. He’s a disappointment. I expected him with his background to foresee the side effects of the housing market bust. Yet, he didn’t. Now we all pay for it.
Yes. I believe we will still be the dominat finanical superpower. However, here is what we need to do:
1.) Pass a balance budget amendment which provides a line item veto and some flexibility in times of emergency.
2.) Address social security and medicare. Create a plan which will explain how the benefits of these programs will be funded, changed and/or reduced to eliminate the projected $50 trillion to our national debt over the next 50 years.
3.) Invest in efficient, domestic energy production.
We must acknowledge the efforts of the ECB and how much more important they will be to us. There ability to act quickly and coordinate the flow of liquidity needs to be applauded and we should be thankful to them.
No, the USA will not lose its place as the world’s financial superpower for one main reason: there is nowhere on the planet where a person with a good idea can move it from idea to implementation as easily as the United States. As long as that remains true, this country will remain the world’s financial superpower.
The U.S. will fall not stay the financial super power of the world because Americans think it is fashionable to buy imports and not save money; thus, over time, the U.S. will trade places and become a 2nd world nation.
yes because now we have the government taking charge. the government can not handle the everyday problems in our country and puts the american citizens last. now they are going to take charge of the financial world. they cant even start the bailout plan because there is too much fighting.
No other country has the rule of law and property rights we have. There is no other country in the world where any one can know with 100% certainty their money won’t be stolen. Just look at the flight to the three-month treasuries from the entire world. I didn’t see foreigners gobbling up Euros.
No, because our Congress is completely and total out of touch with reality (see approval rating) because they are too busy fighting Republican vs. Democrats, and Wall Street is all about greed (see CEO-Exec bonus money for non-performance).
The word Superpower is loosing its meaning. There will be no one dominant financial Superpower in the future. So I guess that means I would say “Yes.”
The USA is going the way of the Dodo bird.
The Fed said it would make “unlimited” numbers of dollars available. Consider that there is not an unlimited amount of gold available.
Gold beats paper money. Always has, always will. You can’t print gold.
The USA with its backed-by-nothing-but-empty-government-promises paper money will soon be thrown onto the asheap of history. Good riddance.
Well, USA is over. you guys have kicked asses for long time. it is about time that the world kick your ass. go around and come around
Yes. And we’re about to formally embrace socialism in the coming elections-assuring that EVERYONE fails…
It seems timely to recall an old german proverb: “When money is lost nothing is lost; when health of lost something is lost; when character is lost — everything is lost”. The US has lost a claim of leadership position for “character”, leading to a loss of confidence and trust. We try to solve teh financial crisis with money — but we cannot use military or or money to reclaim our character leadership.
After the dust settles will anyone trust the US to regulate the global financial when id is obvious that the Wall Street establishment has the Congressmen in their pockets?
Can the US remain a superpower if most of there banks are bought up by foreign investors?
Not very often is it noticed that one can pay himself out of the trouble. The America’s leaders are indeed responsible for the mess and the citizen’s money is responsible for the rescue. i am confused in trying to decide who deserves the credit !! Superpower ?? super mistakes and super bailouts dont make superpowers.
We have already lost that status along time ago. Get used to living in a post-american age where we have to share the pie with other regional powers. Stop adding half trillion dollars of debt every year and get spending under control. Our 14 trillion dollar economy vs. 11 trillion debt makes our economy only worth 30 cents on the dollar based on economic value and output. Not much of a superpower status there. Start living according to your means, shred you credit cards,open a savings account and sonner or later you will have the American dream. And stop hiring Physicists to create idiotic consumptive debt models all so that Wall Street can satisfy its lust for corruptive greed and put in some real regulation that makes for saving competitive and flexible. THE CONSUMPTIVE DEBT MODEL GOT US HERE!!!. Its time to move on and try something else, and if you fell socialisn is coming then its your fault, if you have more that 4 credit cards in your wallet then shutup. Start living accrdoing to your means.
Not with Obamas tax plan. You can not reduece taxes on 95% of the people and raise taxes on the other 5% and have growth. For one thing 40% of the people don’t pay any taxes now. The top 5% are not going to invest thier money if they are not going to make a return on investment.
Usa have already lost the termsuperpower because their huge debts are owned in a very important share out of Usa.World has already changed and a new treaty in economy and politics will fix the main rule in the world for EU.
Thanks.
The USA as economic super power will be somewhat miss leading, I do know though, that we have the regulations we need in place. But how in the name of all that is right did millions of mortgages get loaned to illegal immigrants? Certainly this was not part of some form of deregulation. What we have happened was widespread fraud, yet we the people have not seen one arrest for these crimes. As long as the very powerful and wealthy can run above the law, we will not emerge has a financial super power.
I heard the phrase decoupled-ecnomies about a couple of weeks before the American crisis supposedly spread around the globe. I wonder if American prosperity before the crisis had anything to do with prosperity that is/was being rejoiced across the decoupled economies. If you can answer these questions in a thoughtful manner maybe you will have an answer to your question.
Position is a relative term. To lose the position, there needs to be someone ahead Or better. Today, there is no one to take that lead other than US. Therefore, though the overall situation is in deep trouble, leader OR superpower will be the same for sometime.
After the break of the USSR in those new countries people were keeping their savings in US dollars. People lost some of their savings because of dollar decline. Nobody holds dollars today. Euro, Russian ruble (to smaller extent) replaced dollar there.
Governments of Japan, China, Russia… lost value of their funds because of dollar decline. They will be moving away from dollar, not completely though.
US has good fundamentals which will continue to work and it will remain a world leader. There will be more competition though.
No, unquestionably not. The U.S. is entering an anti-capital populist phase in response to middle class stagnation and the past year’s market crisis. New tax laws will inhibit capital growth, and money-center banks will conduct more business overseas, primarily because more larger businesses will be foreign-owned. Further, foreign wealth will no longer regard the US as the ultimate safe haven and new money centers will provide favorable tax and asset protection regimes. I am advising clients to avoid the U.S. and keep assets overseas.
The US should join the EU. Europe has shreaded their constitutions lets stop pretending that we haven’t.
This question is a very trivial since the current situation and the way things are happenning and U.S meddling with other countries matters.
Though the china eclipses the U.S financial size which is partly true and india is following suit.
U.S govt has to attend to their national matters than outsiders problems than it will remain U.S financial power.
America will remain the financial super power of the world in part because it has gone through these tough times. Unlike the baby boomers the next generation understands the importance of savings and building a nesxt egg. We thought the Amgerican financial crisis will not effect the rest of the world and we have been prooven wrond. Other world economies are following the debt and credit mentality of american past while america itself is recovering from its side effects. So in short America is still ahead of the curve
Nope. It would be China rules the world as China has much healthy control of its financial system and it becomes richer and richer. China has large percentage of holding US debt! US is too stupid by burning money in WAR, too generous social security and health care system. Free market is dead. US should learn from China in order to continue to be the lead.
If there is one thing this financial fiasco has shown us, it is that no matter how multi-polar the world’s markets have become, the shear entrenchment of the US as the global financial center for so long makes it nearly impossible to really shift because of one incident (albeit major). Even as the crisis ensues, for better or worse the world continues to prop up America, because the system cannot function without it or independent of it….yet
It will take years for the resources, expertise and other skills to mature in other markets long before the sun sets on US dominance in the financial marketplace.
Maybe this is a shame; after all the problems created here having such an adverse effect on so many levels – If only we could just get the right policy leaders in place!
The big secret is out. Politicians and the media were hiding the fact that American households have a net worth of over 56 trillion dollars. That is more than half the household wealth of the world. Those statistics come from the Federal reserve Flow of Funds Summary Statistics Second Quarter 2008. If there was a way to get the hoarders of those bucks to go on a long shopping spree the recession in the U.S. would quickly end. But our politicians fear talking to those idle saving account owners and their potential to stimulate our economy, they would rather increase the national debt than anger millions of cheap voters. Consumer spending determines the health of the economy not inflationary government handouts. Until some miserly Americans start digging into their over loaded bank accounts and start spending money our recession will continue indefinitely.
Unfortunately I do believe the U.S. is losing its status of world’s financial superpower. Japan and China aren’t going through as tough times as we are and our infrastructure is no longer drawing eyes. Tourism is booming to places like Singapore, Tokyo, Beijing, Dubai and many others and a large percentage is from American tourists. Americans aren’t spending dollars in the U.S. anymore and instead are spending Yen’s and Euro’s in foreign countries with the potential to become financial superpowers.
It’s possible for the US to earn a new claim to world economic leadership, but it won’t be automatic. Our policies of the past thirty years have been based on the Utopian economic fantasy of “free markets” above all else, and this bogus economic philosophy has failed in exactly the same way it failed when we called it “laissez-faire.”
To establish even a competing claim on leadership, we have to give up trying to live out the fre market fantasy and deal with the realities of what markets are lousy at, along with what they’re good at. Markets are human creations, and they are imperfect.
We know what markets are good at. They’re very good at allocating resources efficiently. They’re very good at exploiting the status quo, including exploitation of proven innovative products. Markets are good at turning the status quo into growth.
What we lack are the means to address the things markets are bad at. Foremost among these, markets are bad at self-regulation; they’re essentially high-stakes gambling houses where the house is in on the games. When the owners of the house are making bets, who’s left to keep the games honest? The most important consequence of this fact is that the owners of the markets have a vested interest in preserving the status quo. This desire for stasis makes markets resistant to change and slow to adapt to new realities.
Another area where markets fail quite predictably is in producing innovation. While markets are good for exploiting proven innovation, innovation itself is an inherently risky business, and market-driven priorities are risk-averse priorities. As a case in point, consider the fact that the US is still trading on innovations that originated with the Apollo moon program, primarily including computer miniaturization based on integrated circuits. Unless we come together as a nation to bear the cost of experimentation, we’ll never reclaim leadership in innovation.
Markets are very good at what they’re good at, but they’re not good at everything. To reclaim a position of leadership in the world, we’ll have to find useful ways of addressing the issues at which markets naturally fail.
Who else could have pumped $1 trillion into the economy to keep it functioning? Europe lagged behind in their own response, and this crisis doesn’t hold a candle to what happened in 1998 in Asia. The evidence suggests that the US is going to continue to be the engine of the world economy for a bit longer, even as China eclipses our financial size.
Depends on new regulations and Government intervention, but I would prefer to be the world’s supersafe financial country than the world’s superpower.
No we will not be the World’s Superpower. If you/we were doing our homework we would see we have not been the World’s Superpower for the last 6 years. Do a bit of research and get “real” scaredl
The biggest problem facing us right now is a national debt and a budget deficit that have reached near unsustainable levels. We are currently borrowing at the rate of $2 billion a day from other countries. At some point, we need to correct this problem before other countries decide to stop loaning us money and the wheels of our financial system grind to a halt once again.
The one thing I have observed about America is, no matter how deep and dark its world may seem, somewhere in time a leader emerges that gets it back on track to MORE prosperity.
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The financial crisis is a symptom, not the root issue. Unless we resolve the root causes, I think we will continue a slow pace of decline, as other superpowers have done in the past.
The financial crisis means we will need to learn to live within our means again. However, until we fix education, we will not be able to extend or even maintain our edges in technology and innovation. Ultimately, these are the key drivers of the American economy.