Cain, your opinion on this piece?

[Doktor Howl]

http://www.independent.ie/business/irish/us-shockingly-lacking-in-political-maturity-2836047.html

[Cain]

Seems about right.

While no-one should really pay much attention to what Europeans say on this issue, for obvious reasons, it is worth noting how China, Russia, Japan, Singapore and South Korea have reacted (with severe disapproval of the whole debacle, with obvious relief at a deal having being reached).  All of those nations have been diversifying their reserve currencies for years now, but this just gives them even more reason to do so.

The world is rapidly realizing that it cannot trust the USA to act in its own, or global best interests any more.  Look at the Republicans.  They nearly put Sarah Palin one angry old man heart attack away from the Presidency.  The last decade was a litany of US failures on a global level, made worse by US insistence that it not only can do no wrong, but that its longest standing and oldest allies should go fuck themselves if they disagree.  And they nearly put someone worse in a position of major international influence.  Economically, it seems, the US can no longer be trusted either.  No-one forgets that the economic crisis started in the USA, and that many European countries would be more secure right now if an international bailout plan, approved by the Fed and Treasury, had not come into play.

The US may have the global prepondernce of military and economic power still, but the rest of the world is catching up in realizing that the US has to be worked around, not worked with.  Unless a miracle happens and it gets its own political-social issues in check. 

I for one approve of this trend. 

[Adios]

I was reading the writing on the wall and suspected that this would happen. We have left countries with little or no option to distance themselves from us financially.

[Cain]

Well, the US is still the consumer of choice for foreign markets, most notably China.

But for how much longer?  The US middle and working class have been gutted in this past decade, and even the US elite cannot compete with other countries very well (did you know Russia has more billionaires than the US now?  India and China are not that far behind).

I don't think economic isolation would be a solution, but certainly firewalling aspects of the US financial system from the rest of the globe and arranging work-arounds (via the Shanghai Cooperation Group and so on) for consensus global politics will become more attractive.

[Adios]

Well, the US is still the consumer of choice for foreign markets, most notably China.

But for how much longer?  The US middle and working class have been gutted in this past decade, and even the US elite cannot compete with other countries very well (did you know Russia has more billionaires than the US now?  India and China are not that far behind).

I don't think economic isolation would be a solution, but certainly firewalling aspects of the US financial system from the rest of the globe and arranging work-arounds (via the Shanghai Cooperation Group and so on) for consensus global politics will become more attractive.

Would it surprise you at all for another currency to replace the dollar as the world currency? We all know China has its sights set on that, but really, isn't the EU in a better position to make a move like that?

[Elder Iptuous]

good lord, i would hope that the world has learned its lesson on having one nations fiat currency be the reserve currency of the world.  i can't see how having a favored status like that could lead to anything other than abuse.

I'm not a fan of the IMF from what little i've read of them, but the SDR basket of currencies, or something like it, seems like it would be a better choice...

[Adios]

Well, one way or another, I think this will be fascinating to watch and see what comes out the other side.

[Triple Zero]

(...) many European countries would be more secure right now if an international bailout plan, approved by the Fed and Treasury, had not come into play.

Could you elaborate on that? How is that the case? I had the idea that it was Greece and Italy and etc's own fault?

[Cain]

I can't see any single currency replacing the dollar.  A mix of yuan, Yen, Euble, Euro, Swiss Franc and Rupee would be a good way to hedge ones bets, however.  Though the Euro isn't in what you'd call good shape at the moment.

Trip: they weren't in good condition, no, but enforcing a bailout on the banks made it worse.  Greece's debt rose from 120% of their GDP (large, if manageable) to about 170-180% immediately following the bailout.  I can't imagine it was much better in any other country with an oversized financial sector and cash-strapped tax base.

[Gordon C]

In my unsolicited opinion the government as been acting like that for years and years. It's as if they hired every sperglord and his buddy to oversee our national security. But that's old news as I know you're already aware of.