Economic Armageddon?

The US stock market is closed today but will tomorrow bring about a true global collapse?

Stocks plunge world wide and Dow Jones futures are already down 550 pts at 1:30 EST.

The US dollar has been in a long slide.

Now bond market insurers, $2.5 trillion in the municipal-bond market, are also looking at massive write offs and downgrades.

The economists' consensus on the Bush economic stimulus: too little and too late.

Capital protection via trade agreements and the free flow of foreign investment, capital, I now wonder if the playing differing domestic economies (PPP) off of each other game is coming home to roost.

We hear about the housing bubble, but is there a capital bubble?

Finally one astute observation:

Global wage arbitrage is a far bigger economic force now than during the bulk of Japan's deflationary years.

Someone is finally connecting this crash to globalization.

Oh, here's a scary fact, consumption accounts for 70% of US GDP currently.



The Cunning Realist

The winter of Discontent

He says:

as long as monetary fixes take the place of "hard work" by elected officials on issues like education and trade, and the Fed does nothing to dispel the perception of itself as "keeper of the flame of national purpose," the destructive boom/bust cycles will worsen.

Right on, this is the issue, they are moving fantasy money around versus being an econony of real goods and services production.