Ben Franklin
October 13th 2005, 10:56 PM
The United States of America... The World's Largest Debtor Nation...!
The Repo Time Bomb (http://www.atimes.com/atimes/Global_Economy/GI29Dj01.html)
Global savings glut caused by dollar hegemony
Fed governor Ben Bernanke argued in a speech on March 29 that a "global savings glut" has depressed US interest rates since 2000. Fed chairman Alan Greenspan testified before Congress on July 20 that this glut is one of the factors behind the so-called interest-rate conundrum, ie, declining long-term rates despite rising short-term rates.
A dollar glut that impoverishes
The glut is only a dollar glut that in fact impoverishes the exporting economies. There is no global savings glut at all. While the exporting economies continue to suffer from shortage of capital, having shipped real wealth to the US in exchange for paper that cannot be used at home, their central banks are creditors holding huge amounts of dollar debt instruments. It is not a global savings glut. It is a global dollar glut caused by the Fed printing money to feed the gargantuan US appetite for debt.
The Repo Time Bomb (http://www.atimes.com/atimes/Global_Economy/GI29Dj01.html)
Global savings glut caused by dollar hegemony
Fed governor Ben Bernanke argued in a speech on March 29 that a "global savings glut" has depressed US interest rates since 2000. Fed chairman Alan Greenspan testified before Congress on July 20 that this glut is one of the factors behind the so-called interest-rate conundrum, ie, declining long-term rates despite rising short-term rates.
A dollar glut that impoverishes
The glut is only a dollar glut that in fact impoverishes the exporting economies. There is no global savings glut at all. While the exporting economies continue to suffer from shortage of capital, having shipped real wealth to the US in exchange for paper that cannot be used at home, their central banks are creditors holding huge amounts of dollar debt instruments. It is not a global savings glut. It is a global dollar glut caused by the Fed printing money to feed the gargantuan US appetite for debt.