IS AMERICA GOING TO THE DUMPS? PART ONE

I had a discussion with a friend regarding America’s prospects going into the future. My argument was while the economy seems weak with a falling dollar and large national weighs us down, the American corporation which is growing because of it’s new business structure benefiting from global growth and excellent balance sheets will save America. This was the response (Note: My buddy is not Anti-American – just a good economic discussion):

The Corporation as america’s savior doesn’t sound as good to me after some research. (I discussed this with my dad and was shot by machine gun with his attacks…i couldn’t out argue him because i didn’t have concrete figures, you can’t just “feel” that american corps are huge and big…)

Yes, I do agree American corporate entities have achieved sophisticated efficiency, the best in the world. Like the machines in the Matrix.

Yes, you can separate the two, American economy and American corporate economy. But aren’t they undeniably interlinked and if America is running a debt it doesn’t matter how well the corporations are doing. At the end of the day, the country is operating at a loss. Trade imbalance measures external loss with other countries, and budget deficit measures internal loss. And both are HUGE recurrent losses not to mention a shaky financial system.

Tell me if you can rebut my thought: America is strong right now and just feeding off of its PAST success, (yes in part because of its corporations that funnel money back), but it is really because the whole world uses US dollars to conduct transactions and THAT fact was established not now but when America was really booming after WWII. When the dollar became the world currency for transactions in goods and trade.

And one MAJOR reason america is losing dominance in the world is the introduction of the Euro. The euro created excess liquidity, an alternative choice, Japan wanted to become a world currency but failed because they sucked in too many USD and became infected with that disease. The introduction of the Euro also contributed to a new global inflationary rise in prices…simply because there’s more money in the system.
Now the middle east oil producing countries are slowly rebuking the USD – which is causing further erosion – and greater adoption of the Euro. The Euro to the dollar has appreciated 40%!!!!! Imagine, suddenly you are 40% worth LESS over the decade since it was introduced.

So the Corporate savior theory may not be the answer. because corporations go down just as easily when the economy of the country starts to fail.

Stay tuned for Part Two!!!