Wednesday, Sep 27, 2006

Watching the US ...

MoneyWeek: Why the US economy is more sickly than you think

A predicition of the US' economy which establishes a new link between equity withdrawl and economic growth. "US consumers have forgotten the difference between the wealth that arises from a surplus of income over expenditure and wealth that arises from the embracing of debt, that debt has been used as if it were surplus income."

Posted by talking rot @ 12:31 PM (1762 views)
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1. Ali said...

Now let me think where else in the world has credit run wild and people are using equity release to fund their spending habits , rubs chin pondering, oh dear I think its hear!!!

Wednesday, September 27, 2006 01:23PM Report Comment

2. Gideonr said...

While he talks about the "traditional" wealth withdrawal being 3.5%, he doesn't give evidence for what it is now. In the absence of an up to date figure, the article becomes pure conjecture about what might happen. Maybe Americans will carry on spending to drown the sorrows of their house price falls? I think it may take real mass foreclosures to wake them up to their past rampant real estate profligacy, and hence affect their spending rate.

Wednesday, September 27, 2006 04:25PM Report Comment

3. the bald man said...

What happens in the Us usually follows in the Uk

Wednesday, September 27, 2006 09:08PM Report Comment

4. indiablue19 said...

Well, far be it from me to argue with Woody, but unless he's a teenager surely he remembers exactly this same thing happening in the 1980s in the USA? That doesn't exactly make this uncharted territory as he proposes. A number of people lost their homes, cars, diamond tiara, holiday homes. Everybody got really mad about it and swore this would NEVER happen again. It is happening again, [and evidently also happening many other places in the world] because one government after another decides to form a self-serving partnership with unscrupulous bankers and impress consumers with their entire lack of business acumen and forethought, at the complete risk of any economic stability for the common person. The sight of Clinton today in his couple thousand pounds of sartorial splendour, announcing to us all commoners what a great job Gordon Brown has done. Enough to make a blind man see.

Wednesday, September 27, 2006 09:35PM Report Comment

5. waitingfor hpc said...

i agree - what a joke getting Clinton over here - who has no idea about the UK to say that.

Thursday, September 28, 2006 09:36AM Report Comment

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