From comments:Global Imbalance - An imminent Dollar Crisis
Venkatesh is definitely impassioned and speaks about interesting subjects, but his interpretations leave much to be desired both in depth of knowledge and analytical rigor. I would call him a demagogue, short on facts, and skewed in conclusions . Some of his predictions have already been proved wrong, eg US currency exchange rates, oil prices; and his analysis/prescriptions reveal a profound lack of insight, eg lack of US family formation as the cause of savings rate declines in the USA. There are indeed many troubling problems in the US, including the real estate bubble, productivity slowdowns due to education and technology problems, consumerism as the driving force for the economy, asset valuation failures in lending, a drain on US wealth to fund the Iraq war etc. Exports to the USA have been the driving force for the world economy for decades. This is the reason all countries work really hard to get “MFN” – most favored nation, so that their exports are allowed in to the usa with fewer restrictions. This creates jobs, wealth and infrastructure (and funds for research and new technology) in the exporting countries. Countries often finance a portion of their exports to create demand for their products, as most countries, (incl india and china) have done to fuel their industrialization. Stop US imports and consumerism, and the world economy will grind down. Consumerism as a economic model is definitely flawed and problematic, and causes downstream problems, see http://www.storyofstuff.com The only significance of the Venkatesh video is that some few people may possibly believe it to be true and accurate, and make decisions that will ultimately prove to be injurious to their economic well-being. Far the greater threat both to US and Indian (and global) well-being, is the base assumption that continued growth in consumption, production, population etc is possible or desirable in a very resource-constrained “closed system” like the planet earth (ie essentially no resources come in from space – except for sunlight/heat, and none go out), a small blue dot of life in a vast and unfriendly universe.
Friday, December 19, 2008
Global Imbalance - An imminent Dollar Crisis
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Crisis of the U.S. Dollar System
http://www.globalresearch.ca/index.php?context=viewArticle&code=ENG20061014&articleId=3482
I heard MR Venkatesh on google videos an hour ago. He said too many things in that one hour of time. While admitting that he was exaggerating during his speech, he tried to take a very "Swadeshi" and "protectionism" portal... I wouldn't disagree with him on how women in India save and how religious festivals make a normally 'saving families' spend and strike a balance. However, given the audience he is speaking to and the portal he chose to speak on, a lot of facts were disfigured. This economist was not making a prophecy, he was just using the current affairs to support the 'swadeshi' concept.
On the 'family system', it is true that people tend to 'splurge' when they are emotionally low, and this low can happen both in a marriage and a divorce. It was not made 'easy' for Indian citizens to tap into un-limited credit so far, hence checks and balances were a 'blessing in disguise' (not by design) that helped save the households in general.
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