"The last superpower" in the loop of debt

"The last superpower" in the loop of debt

Hot summer day in Rome, met the deputies of Parliament, economists, church leaders and civic organizations - more than a hundred people. Appeared before them a well-known American economist Lyndon Larush. He spoke on the complete bankruptcy of the current monetary system, and proposed a new Bretton Woods conference. Establishment of a new global monetary system, according to Larusha, creates prerequisites for global economic recovery. In particular, through the issue of long-term low-income lending commitments for large-scale investment projects. One such project, proposed by Larushem - the creation of the Eurasian bridge.

Lyndon Larush was keynote speaker at other conferences. With good reason it can be argued that it is today - one of the most popular politicians in the world. Analysts Robert Freeman (Richard Freeman), and G. Höfle (John Hoefle) prepared for the publication of a newsletter published by L. Larushem Executive Intelligence Review1, which provides a rigid picture of the U.S. economy, strong debt prolonged loops, and prove that the epicenter of the global systemic crisis is United States, "the last superpower" and "importer of last resort> with the rest of the world. Translated article published with the consent of the authors and L. Larusha.

The pyramid above the roof
The rapid growth of public debt the U.S. creates an environment for a hyperinflationary explosion as within States and across the world. By the end of 2001, total debt reached U.S. $ 31.12 trillion. On average over the last four years, domestic debt grew at a rate of U.S. $ 2.2 trillion. per year, nearly $ 200 billion per month!

The debt pyramid has become such a high that it is impossible to maintain. Moreover, each new attempt to destroy the service as the real economy, and its bankrupt financial system. By the end of last year, the annual payments in U.S. interest plus principal payments on the loans reached gigantic sizes in the $ 7.36 trillion., Equivalent terrible value - 72.1% of the gross domestic product!

Bubble age in three decades
American debt bubble has its roots in mid-1960's, to the actions of financiers in London City and Wall Street have an impact on policy development of post-industrial society. This policy has led to a drastic reduction of production in industry and agriculture, to sezhivaniyu infrastructure, it has contributed to the development of speculation, which created a huge financial bubble. The real economy has been declining annually by 1-2%.

Three nodal moment led to the consolidation policy of post-industrial society. First - when President Richard Nixon on Aug. 15, 1971 separated the dollar from zolotorezervnogo standard, which led to the isolation of financial flows from the flow of industrial products. The second occurred in October 1979, when Federal Reserve Chairman Paul Volcker United States went to the policy of <-controlled disintegration of the economy "and eliminate all restrictions to the growth of bank rates. As a result, the base lending rates of commercial banks jumped in a year right up to 21.5%, which has had a depressing effect on the real economy.

The third happened when Wall Street has provoked a massive buyout of controlling interest under the loans, paid by the company (leveraged buy-out, LBO), which has led to fragmentation and acquisitions of companies.

This lasted for more than three decades, the process has given rise to the debt jump on two fronts - in production and in non-production sphere.

Non-productive sector of economy has accumulated a huge debt. For example, vysokospekulyativnye acquisitions and acquisitions of companies that are discussed above, have been financed with debt. In the 90 years of Internet companies, telecommunications, and all nasobirali whole mountain of debt. Politics of post-industrial society means that the organizations and households had to offset their losses due to reduced production. In order to offset the effects of economic recession, many manufacturers of industrial and agricultural products have been forced to borrow money to purchase new equipment, raw materials, and even payroll. To prevent a decline in living standards, millions of American families vlezli into debt to pay for housing, clothing, medical bills, furniture, household appliances and even food.

These two types of debts have merged, leading to a sharp rise in the total debt of the country. The tsunami of debt Household Total U.S. debt is composed of three parts:

- Consumer debt, which includes mortgage debt to buy homes, consumer debt for the purchase of household furniture, car, etc.;
- Business debt;
- The general public, federal, state and local debt
debts.

The growth of household debt in the 1945-1970 years was relatively small, and until 1978, he was not more than one trillion dollars. Then, due to the regime of high interest rates Volcker, he rushed up. By 1990, debt had reached $ 3.63 trillion., And for eleven years, rose another four-plus trillion. To put the debt burden of the population, unprecedented in the history of the country. Government debt at all levels, which is more than the federal 80%, continues to grow. By the end of last year they reached $ 7.16 trillion. Business debt - the fastest. It includes two sets of entities. The first - non-financial companies, energy and telecommunications, unincorporated entities, and rural farms. The second - the financial company, which includes banks, insurance companies and the Federal National Mortgage Association (). From 1995 to 2001, total business debt has doubled and reached $ 16.3 trillion. By the end of 2001, domestic debt reached U.S. $ 31.12 trillion. (Fig. 1).