…or China just needs buy yet more dollars (at least the jetsam sold back into the market by GCCs and other exporters unwilling to hold dollars). In other words, "more of the same"….no?

I think back to 1986 and my concern about rising US private & govt debt-to-GDP ratios, and even though I was vindicated for about a nanosecond in 1987, I can’t help but muse "Wow, was I early on THAT one!"

What will happen to the value of the dollar during all of this? I think if China doesn’t help out, it will depreciate even more.

Koteli,

So in your mind "two wrongs must make a right"? How immoral of you…

Holmes: "To the curious incident of the dog in the night-time."

Gregory: "The dog did nothing in the night-time."

Holmes: "That was the curious incident."

Copying and pasting:

( Some ) Americans tend to believe that they own the planet, that they can consume and pollute without limits, even if this threatens the future of ALL people on the planet. And they obviously expect that even people in very poor countries cut back in their consumption habits to allow the continuous over-consumption in the U.S.. That’s a pretty primitive attitude.

America has never proved over the last century that it has any special sense of responsibility toward the environment or the living standards in other, especially poor nations. It consumes more than any other nation, pollutes more than any other nation, gives less in foreign aid than most rich nations, blocks regularly international attempts to improve environmental standards, uses often military force to push through its economic interests and is often at the front line when it comes to boycott the very moderate attempts to improve labor or social standards in China and other developing nations.

Against this background the whining about the declining American living standards and the evil Chinese or Indians that take away a part of the American wealth or American jobs looks pretty ridiculous. America has never shown any kind of special consciousness for the price many people in the third world pay for the excess consumption in the U.S.. Why should Chinese or Indians bother now about the fate of the "American worker" or the "poor" American citizen from suburbia with his over dimensioned SUV?

And by the way the people that will be hit the hardest by a steep increase in energy prices or a dramatic climate change would be citizens in poor countries ( as we currently can see in Myanmar ). The adjustment costs in rich nations will be moderate in comparison. And different from most poor nations rich countries have the economic means to rebuild their societies for a more sustainable future. It’s not the fault of the Chinese or Indians that America has missed for decades to make its economy more energy efficient or reduce the enormous waste of natural resources in the U.S..

Most problems that plague America today are home made. No one has forced Americans to consume more than they earn. No one ( at least no foreigner ) has seduced them to start a stupid war in the Middle East. To lower the social protection of U.S. workers and undermine the labor standards in the U.S. was the result of domestic political decisions in the U.S., not a consequence of globalisation ( but globalisation the way its currently organized is a typical result of the neoliberal domestic policy of the last decades).

The creeping impoverishment of millions in the U.S and rising inequality are a typical outcome of neoliberal supply-side politics. The short breathed style of capitalism which treats workers like removable things is a classical American invention. No Chinese or Indian is responsible for the messed up health care system in the United States which leaves many millions without appropriate protection. Exploding college fees are not the guilt of poor people in foreign countries. And so on and on and on.

If Americans feel uncomfortable with their situation they should start at the home front and begin to change their own country, not expect people in much poorer countries to renounce for the well-being of the American consumer.

Besides: The people which profit the most from globalisation are not workers in the third or second world. It’s the capitalist "elite" of the Western world which makes the highest gains – on the back of workers in developing countries AND in rich nations. And they should be those, who pay the price.

Is the euro area more, or less dependent on oil imports than the U.S.?