The whole world is keeping a closer eye on than ever on what’s going on in the United States of America. Democrats and Republicans have a serious disagreement on the debt ceiling. And failing to raise the debt ceiling will a catastrophe for the world economy
From the start, I support the causes the Democrats have been fighting for. But I now can’t tolerate on both sides. Let me be clear on a point, the policy of my blog is to say not what I should but want. To say what you should sometime implied the pressures from the outside world. Not taking side. I just say what I think it right.
What they are doing is a conspiracy to deceive the world again. They have done it many times already. The most obvious one is 9/11 attack. They are finding a way to inject more and more money into the economy (QE3). Republicans are taking the world economy as hostage to demand concessions from the Democrats.
|Barack Obama : Politics is a mission not a business.|
I can’t help but to say that US politicians are young in term of their course of action, at least for now. They just keep craving for nonsense things happening at the expense of the whole world. They are Young Politicians. The world is at risk now. The Great Depression might return in the very short order. Who knows?
By the way, I want to brief you on the stances of Democrats and of Republicans. Democrats support spending and tax increase for the rich and tax slash for the poor. And the Republicans are just the opposite. I support Democrats because America’s middle class have been oppressed over the last three decades. It’s high time they were treated with great care.
I don’t support Democrats because I think they are collaborating with Republicans to do it again. I’m surprised that only few people believe that the crisis of 2007 is a man-made one. I have been researching on the debt ceiling debate for a while. My conclusion is that the default is “both likely and unlikely.”
First scenario: The Fed used to hint about the possibility of implementing QE3. I think it’s unlikely because of two main reasons:
1. It will endanger Obama’s bid for reelection. QE3 will push down the value of dollars and that’s why it’s especially unpopular with the average Americans. As I said again and again, QEs is attracting more and more investors, esp. the native ones, to America. My professors told me QEs are not working.
I can’t agree more. It’s only a matter of time that QEs will become effective and get the economy moving again. It won’t be that long. Do think the Fed has a good pretext to inject the money into the economy when QE1 and QE2 are effective. Absolutely not!!!
2. QE3 will produce a strong backlash from the rest of the world. In China, India and Brazil, inflation is already high enough. QE3 will be damaging.
Second scenario: America won’t default on its debt unless she wants to be that way. I’m skeptical that Obama is cooperating with Republicans to make US default on its debts. And the QE3 will be easily passed without strong outcries from the rest. If so, the United States is playing with fire. What would China and Europe do? US politicians are winning the battle as Americans are losing the war.
Hopefully, my second scenario is totally wrong. However, only one scenario can stand the test of time. There are a few days to go. Let’s count down the countdown.