quote:

Originally posted by rupert Sounds like its bogus to me. Like a hollywood movie script.

^^ That's what I thought too. Too movie-like, but then I remembered 9/11 and THAT was also too "movie-like" yet it happened.

Not saying that 7 nukes are going to blow up the 7 largest U.S. cities though! That's just crazy-talk. (lol)

quote:

American is a paper tiger and its power and credibility has been diminishing for years.

Umm...I beg to differ. Proof? Turn on your t.v.

quote:

Originally posted by Alccode ^^ That's what I thought too. Too movie-like, but then I remembered 9/11 and THAT was also too "movie-like" yet it happened.

That was a very good observation.... i rememeber everyone that first saw the images from new york comparing that to an action movie. People running from the plumes of smoke, chaos, screaming, planes slamming into building etc..

What a horrible day

___________________
"This place isn't big enough for me to blow it up."
-MARCO V

quote:

Originally posted by D'Paul Looks like a reasonable interview. But I have reason to believe its very fake. Al-Asuquf is not a traditional Pakistani name and in such case, I could not see a person from a non-India bordering country using the word "Maharajas," which stems from Hindi, a very Indian language.

Maharaja is used in arabic, it means indian king. And about Al-Asuquf (i would love to see it written in arabic), muslim clerics have arabic sounding names, even if they're not arabic.

___________________
[/IMG]http://i54.tinypic.com/ngycqo.png[/IMG]

quote:

Originally posted by ahlamalek Maharaja is used in arabic, it means indian king. And about Al-Asuquf (i would love to see it written in arabic), muslim clerics have arabic sounding names, even if they're not arabic.

Interesting, didn't know that the word had travelled so far. I understand your muslim clerics point, but with all the contact I've had with Pakistanis (my family is from the state of Punjab in India), I really haven't come across a name similar to that. Of course, I can't speak for all of Pakistan.

you can do a Google search which shows that the Al-Asuquf "interview" is a fake.

quote:

Umm...I beg to differ. Proof? Turn on your t.v.

That the USA was able to topple a hated dictator who had no effective army and no airforce doesnt scare anyone.

People used to think the Soviet Union was extremely powerful and would always be around. It had a massive army and airforce.

It spent beyond its means investing in weapons rather than people.

Now look at it.

quote:

Originally posted by rupert That the USA was able to topple a hated dictator who had no effective army and no airforce doesnt scare anyone. People used to think the Soviet Union was extremely powerful and would always be around. It had a massive army and airforce. It spent beyond its means investing in weapons rather than people. Now look at it.

That's a poor example. The US spent MORE money on weapons than the Soviet Union at the time, AND it experienced widespread economic growth at the same time. The US economy is not in a recession, productivty is actually increasing:
http://frwebgate.access.gpo.gov/cgi...=17mr03.txt.pdf

Unemployment is still far lower than levels in Germany, France, and much of Europe, and inflation is low. So how exactly is the US economy a paper tiger? Because if it is I'd hate to see what you call the other world economies.

___________________
Retro ...

Haha, people, face it, the U.S. is here to stay no matter how much you might not like that.

I guess the only real question is just how far it will go in terms of dominance.

quote:

Unemployment is still far lower than levels in Germany, France, and much of Europe, and inflation is low. So how exactly is the US economy a paper tiger? Because if it is I'd hate to see what you call the other world economies.

Appearances are deceptive.

The reasons why america is a declining power are numerous but I will try to keep complex economic issues short.

During most of the Cold war america was the worlds largest creditor nation. America was the worlds largest investor and had the worlds strongest economy. It could afford to wage long wars. In those days there was a relatively closed capital market, a relatively closed currency market and trade was far more regulated and controlled than it is today.

Now it cant. Not forever anyway. America has very very serious structural problems with its economy (which isnt to say that other countries dont but we are talking about america here)


1) It runs very large trade deficits, which will only get larger

2) it runs increasing federal government debt to pay for an ever increasing military budget having soldiers in more and more countries. This debt will only get larger.

3) ever increasing state government debt. As the federal government diverts fund to pay for defence and tax cuts to the rich it reduces the amount it pays to the states. Many states in the 90's lowered their own state taxes. Which now means many states cannot make ends meet. They obviously either have to go into greater debt or cut essential services.

4) an ever increase divide between the rich and the poor. This issue is important because you need increasing wealth across the board both to support the trade debt and the budget debt. Yes america is getting wealthier but not where it really counts amongst people who pay taxes. The rich and the major corporations dont pay taxes and there is only so many plasma tv's or BMWs that a rich person can buy.

But you say, most americas are still able to make ends meet, productivity still keeps going up. Sure, but this is illusory. Real wages amongst the lower to middle classes havent gone up for twenty years but they can maintain there living standards because of low interest rates. This has lead to very large levels of household debt.

So this means you have a) a government that lives beyond its means, b) an economy that spends more than it earns c) individuals who borrow to make ends meet.

Using the unemployment rate to compare living standards the US and Europe is misleading. America uses the prison system to get unemployed people off the streets. If you add the 2 million people in the corrections system you would see the unemployment rates would be comparable.

4) an overvalued currency.

5) an overvalued equity market

So what does all of the above mean. America is dependant on the rest of the world to buy its debt. And what happens when foreigners decide that america isnt credit safe . Because america does not have restrictions on the movement of capital there will be Capital flight. People will pull their money out of america in droves just like what happened to all those third world countries in the nineties.

America uses us to pay for its defence program and when we decide that federal bonds arent an attractive asset to hold compared to what I get elsewhere, america will have to take drastic steps to reduce its debt. America does not have the capacity to wage large wars because its financial situation. This is not something I make up Greenspan even hinted at the risk of capital flight in one of his speeches.

There is a complex relationship between debt, interest rates and currency valuations which I wont go into here but I stand exactly behind what I said. America is a paper tiger that can afford to fight weak countries like Afghanistan or Iraq who cant really fight back on any really effective level and thats it.

quote:

Originally posted by rupert 1) It runs very large trade deficits, which will only get larger

It's true that America runs at a trade deficit however, it has been operating at a trade deficit for the past 2 decades if not more. This in itself is not indicative of anything. If you look at US owned interests abroad as opposed foreign intrests owned in the US you will find the trend to be stabilizing with no imminent drop as indicated by a failing economy:
http://frwebgate.access.gpo.gov/cgi...=37mr03.txt.pdf

quote:

2) it runs increasing federal government debt to pay for an ever increasing military budget having soldiers in more and more countries. This debt will only get larger.

Once again, a large federal deficit is nothing new. The government has been running at a deficit since the beginning of time yet I fail to see a collapse of the economy. As a matter of fact, the deficit continued during the time of the Clinton era until the very end ... if I remember there were huge economic bounds during that time period.

http://frwebgate.access.gpo.gov/cgi...=32mr03.txt.pdf

I will continue this argument when I'm less drunk and able to look up the trend of wage distributions. I'll come to a preliminary conclusion however and sincerely doubt that the US economy is a paper tiger in any aspect in its current situation.

Additionally it would be welcome if you provided economic data to back up your claims

___________________
Retro ...

quote:

Once again, a large federal deficit is nothing new. The government has been running at a deficit since the beginning of time yet I fail to see a collapse of the economy.

I doubt it would collapse either. What I am saying is if capital flight becomes a real issue then americas military will be all for nothing because america cant afford it.

No, the deficit isnt new. The fact that the world has completely open capital markets is. The market has a way of imposing "discipline" on countries that consistently run deficits.

Rather than post specific links on each issue. You can find information which supports a lot of my contentions at


http://www.epinet.org/ - policy institute, americans would call it liberal, i would call it mainstream.


http://www.fguide.org/resources.htm - has many, many useful links that corroborate what I said.


http://www.cia.gov/cia/publications...trends2015.pdf. Doesnt talk about what I said but is a policy document released by the CIA which talks about risks to america. Gives a good understanding of how policy elites see america.

On general economic issues, in particular the state of the american economy I highly recommend anything written by Warren Buffet the CEO of Berkshire Hathaway which can be found on the Berkshire Hathaway webpage and Stephen Roach chief economist of Morgan Stanley (do a google search or regularly pick up the WSJ). In particular anything by Warren Buffet should be paid close attention to.

He has remarked critically about the tax cuts plan, and has warned about the risk posed by the derivative markets. (which could trigger capital flight)

On a more conservative note Im sure a Google search on George Soros would provide many articles on the risks of the global currency market.

People have no real understanding of how brittle the global economy really is. What happened to Thailand, Brazil can easily happen to the USA or any of the other 1st world countries that investors suddenly get wary of.

Markets operate on sentiment not reality. Anyone who tells you that markets are perfect is a liar or a rightwing lunatic. If something dire happened in the USA, like another Long Term Capital Management disaster, it could lead to a stampede of investors out of america. Maybe it wont happen but it is something that I, if I were an american politician would be seriously concerned about.

quote:

Originally posted by rupert I doubt it would collapse either. What I am saying is if capital flight becomes a real issue then americas military will be all for nothing because america cant afford it. No, the deficit isnt new. The fact that the world has completely open capital markets is. The market has a way of imposing "discipline" on countries that consistently run deficits. Rather than post specific links on each issue. You can find information which supports a lot of my contentions at

Well I looked up your sources but I couldn't find anything pertinent. It would be a lot more helpful to reference directly to your arguments.

Anyway what differentiates this "open capital markets" from the capital markets in the 70's or 80's? The US was operating at significantly higher deficit levels and there were no repurcussions from world markets so I fail to see what kind of impact today's market will have on today's relatively insignicicant deficits.

Secondly, I fail to see how a flight of capital would occurr. Perhaps if there were political instability in the US government such that foreign investors would be apprehensive about investing capital here, then MAYBE I could see such a scenario happening. But how would it happen otherwise? A devaluation in the dollar? That would only attract MORE foreign capital investments since the European currency would valued so highly against the dollar. Although that would dramatically increase the import costs, that is a separate issue from capital flight.

quote:

People have no real understanding of how brittle the global economy really is. What happened to Thailand, Brazil can easily happen to the USA or any of the other 1st world countries that investors suddenly get wary of.

How could they occur in US markets? The economic situation is so drastically different between these markets that it's absurd to imply such scnearios could impact US or European markets in a similar matter.

___________________
Retro ...