Skip to comments.Europe sees US debt crisis as dire as its own
Posted on 11/28/2012 4:11:26 AM PST by John W
Now its Europes turn to worry about U.S. economy.
American officials have been wringing their hands for the past two years about the heavy burden of government debt piling up in Europe. On Tuesday, Europes Organization for Economic Co-operation and Development warned that the U.S. "fiscal cliff" threatens prospects for the eurozones economic recovery.
Were talking here about the medium and long-term viability of the United States economy, OECD Secretary General Angel Gurria told CNBC. Not only to avoid the fiscal cliff but then get to a moment where (U.S.) debt stops rising and the debt to GDP starts coming down to an area where we call all breathe more comfortably.
In its latest Economic Outlook, the influential Paris-based think tank said that with the eurozones economy already headed in reverse, the United States faces the same fate if lawmakers fail to agree a deal to avoid a combination of tax hikes and budget cuts that will otherwise take effect next year.
The US fiscal cliff,' if it materializes, could tip an already weak economy into recession, while failure to solve the euro-area crisis could lead to a major financial shock and global downturn, Gurria told reporters in Paris.
(Excerpt) Read more at nbcnews.com ...
Because it is. We bought it. On credit.
Once Li’l O has left the stage, perhaps it will be time for some land sales to retire the national debt!
Great! I hate to think just who will be able to buy it and what they would do with it. Most of it gets too little rain for growing things. (I grew up “out west”). 85% of the west is BLM. Not even really great for ranching.
The dollar and the Treasury market, when it comes to safe havens, are going to be the Facebook of safe havens, because a lot of people wanted to buy Facebook on the IPO. They were really excited about it. They thought it was great. But once they owned it, and they took a look at what they owned, and they looked at the fundamentals, they realized it wasnt so great. And they wanted to get out. The same thing is going to happen to people who are buying dollars, because they think its a safe haven from European debt.
America is more deeply in debt than Europe, and less likely to repay without resorting to massive money printing.
And if you think theres going to be a lot of money printing, that is not a reason to want to own Treasuries or dollars. That is a reason to get as far away from the U.S. dollar and the Treasury market as you can.