Predicting a low USD is not Anti-american. Spamming posts like "haha! No one will fall for the US bullshit anymore...it's going to be a banana republic!" oozes anti-US sentiment. If you cannot read that, then I'm wasting my breath.
No, I wasn't trying the old "no safe place" argument. What I was saying is that as the dollar sinks, and prices become more expensive, inflation rears it's ugly head. The Fed acts to raise interest rates. Meanwhile markets that suddenly find themselves no longer selling much to the US become flooded with inventory, revenues drop, and layoffs occur. The economy slows. Inflation is NOT a problem due to high currency and the CB cuts rates. The market equalizes on it's own without people becoming a banana republic.
<i>"Where people have no access to clean water supplies. Where water scarcity is killing of agriculture? Where literacy rate is around 20%? Where the inflation rises faster than the regular wages?"</i> Those are all problems currently found in this country, or on their way in the scale. Not to mention homelessness and malnutrition due to poverty. I never said the U.S. will be a third-world country. I said it will have the third (or worse) currency rate and be a second-tier superpower in my lifetime. There were long periods of time when the sun never set on Italy's or England's global empires. Neither is a third-world country today... but what would you call them?
They sell to China. John Mauldin is right the world economy will become less depended on the US as Asia develops its own market and a more balanced world will develop. In the mean time the US Treasury will be introducing a five hundred dollar bill
Ah, and what percent of China can - at the moment - afford a plasma tv? How about an SUV? How long will it take until the majority of Chinese will be able to consume like the US does? These are just directional questions. My underlying point is that we're all locked in a death dance here. Some of you folks think the world can just write off the US as bad debt and walk away with no problems locally. That's ludicrous.
The leaders of various countries are spending a lot of time trying to keep the current global financial/economic system together. The question is what is going to happend when someone blinks? The geopolitical aka real world doesn't seem stable at all.