I have been lurking and only occasionally posting over the past year. That does not mean that I have not done a lot of study. I have a degree in economics, and I am an observer of the world situation. Most of my information comes from the American media. I have taken a good bit of time out of my work day to spell out my fears for the United States and the world in the coming year. May my manager be forgiving. **********************************************************

The United States' infrastructure will hold up better that many of the participants of this forum would guess, but grave danger lies ahead nonetheless. The biggest problems next year are likely to be terrorism and a coordinated attack on American interests throughout the world. As Richard Maybury has said (see www.chaostan.com) it is possible for the following to occur on one day at the same time: North Korea invades South Korea, Iraq and Iran invade Kuwait and Saudi Arabia, China invades Taiwan, Palestinians attack Israel, Serb militias begin killing American troops in Kosovo, hackers from points unknown attack America's computer systems continuously. The logic of this is obvious. The United States could easily respond to just one of these attacks, but if they are coordinated together at a likely agreed-upon hour, the US will be overwhelmed. If Richard Maybury could think of this, is it not certain that the terrorists who are obsessed with violent intentions have not thought of it?

A large swath of the world has serious problems today. The financial crisis in Asia is not over; it has just barely begun.

The leaders of Asia and western Europe seem to believe that the United Sates has a responsibility to tolerate mercantilist policies: protect the home market, buy locally, sell abroad. It is simply not possible for the US-rest-of-the-world trade imbalance to continue. We can't MAKE it continue. They can't make it continue. The trading system has long been in a state of imbalance. A disequilibrium of this scale must be corrected, and it must be corrected at great costespecially to those nations that have come to depend on large trade surpluses. The normal and natural way to rectify this imbalance is for the dollar to devalue until trade flows are at least even between the US and other countries. However the nations of the world, especially Asia, simply will not sit by and watch their trading advantage disappear. When the dollar begins its long unstoppable depreciation the Asian politicians will gun their printing presses like crazy. They will devalue by printing money in reams -- as they have done before, only this time the Chinese will not stand by, heroically preserving the value of the Renmimbi.

The Chinese banks are teetering on the brink of collapse. Government subsidized Chinese industries have mountains (literally not figuratively) of unsold goods piling up. The Chinese know that these industries should be shut down, but they worry about the social problems that will arise if these industries are shut down. When the bad investments of the Chinese industries and banks begin to be unwound, a devaluation is almost certain. The Chinese will devalue their currency and blame their problems on the United States. A devaluation of Chinese money (combined this with the recent problem of the strengthening dollar biting into Asia's trade position) will certainly result in yet greater devaluations of currencies across Asia. And who might be next in line? Recent problems in Ecuador indicate that Latin America could be next in line, then the world's currencies collapse. How could the world's currencies not collapse?

When this happens will the governments of the developing nations accept responsibility for the results of their bad investments, or will they try to blame someone? Guess who?

The United States will not suffer nearly as much as other nations, but the US economy will be affected nonetheless. How will Americans who have prostituted their votes for Bill Clinton feel then? They compromised their principles in 1992 and 1996 by voting for Clinton. They slid deeper into the pit by not raising an outcry: adultery, rape, giving away nuclear secrets, freeing terrorists from prison  it doesn't seem to matter much any more. When the world's currencies collapse these Americans will have lost both their dignity AND their 401ks.

What will the response be? Will there be a moral revival or will our nation continue its downward slide? As Cory Hamasaki said, something evil this way cometh.

**************************************************************** This is just the opinion of one middle-aged man in Austin, Texas, 99 days or so before the year 2000.

May God bless all who read these words.

Richard Fry

-- Rick (rick7@postmark.net), September 23, 1999

Answers

Rick:

I agree with everything you have said, especially regarding the trade imbalance. This is another legacy of our illustrious Slick Willy. Since this is an OT post, I would like to point out Pat Buchanan's policies on trade. They can be read on his website at www.gopatgo.org. He is saying a lot of the same things you said. I'll repeat my opinion again - WE NEED STRONG LEADERSHIP IN THE WHITE HOUSE. I still hear people saying they would vote for Gore or Bush - more of the same. We need a man with integrity and strength to pull us out of the mess we're in, and the bigger mess we're going to be in next year.

This is just the opinion of one middle-aged woman in New Orleans, Louisiana, 99 days or so before the year 2000.

-- Scarlett (creolady@aol.com), September 23, 1999.

This is all assuming that there will not be an attack on America, bio or nuclear in nature.

-- Mumsie (Shezdremn@aol.com), September 23, 1999.

If the economy is growing by $5 per year, and the trade imbalance is $4 who cares? If the economy is growing by $5 per year and the trade imbalance is $6 Our economy is still growing is it not?

-- (eric@confused.com), September 23, 1999.

Rick, I read your headline and thought you might *be* Richard Mayberry! I've dropped most newsletters, but his "US and World Early Warning Report" is a keeper.

-- DaveW (dwood@southwind.net), September 23, 1999.

Mumsie:

Yes, good point.

Eric:

I can only compare it to living your life in debt - you might have a great lifestyle for a while, but eventually, it catches up with you.

-- Scarlett (creolady@aol.com), September 23, 1999.

Rick,

Good post. I think lots of problems are coming are way.

God Bless

-- More Dinty Moore (dac@ccrtc.com), September 24, 1999.