Archive for the ‘Spending’ category

What should the USA do?

November 25, 2010

The USA must make a couple of things to hinder an economic disaster: the old good manufacturing must get back to the states. That can be done by giving exemptions from corporate taxes and paying for education and training of new employees – I would go even further and say that in stead of printing dollars and buying bonds that money should flow to education of the citizens.  Corporations should also be able to hire for minimum wage and work free of trade unions – at least for 7 years. That would curb the USA back on track! I haven’t seen any better real proposal, but just the QE2 – printing cash is no real solution at the end of the day! This will certainly help avoiding deflation, but will on the long run increase the interest rates. When the money would flow to the education, schools, colleges, and universities it would increase the know-how and knowledge, but be also in circulation and not handled through banks only! This is a true alternative! Manufacturing and education would generate a lot of new jobs, make people able to earn money and pay bills and buy stuff = consume! This way is the better way.



October 2, 2010

New cities and infrastructure is getting built in China. Fresh water, raw materials, and food will become an issue besides the energy. China is also demanding control on South China Sea. The US is claiming interest in that area as well. Furthermore the pressure is increasing in the US to pass a legislation to put duties on imports from China in order to compensate for China’s currency undervaluation. The House of Representatives will most likely pass this bill. The tension is going to go up. On top of this China and Russia have signed a contract on oil and gas deliveries from  Russia to China. China is demanding a lower price than what EU-nations are paying for energy. In my eyes the US and EU relationship should get more focus and value. The future will be pretty much a complicated one: EU must focus on energy and water which leads to think about more presence in the Arabic area and Nordic region. Even the tiny Denmark has claimed rights for oil and gas at North Pole region due to her majesty’s land of Greenland! All these developments will cost money and increase tension. At the end of the day the EU must start to build up an army, although this is now very unpopular and trend is the opposite one. If US is about to focus on more on Asia in military respect (the largest military base outside of the US is in construction now on the island of Guam – 3 hours flight away from Tokyo) and home market issues like the bill to change taxation on foreign income of US corporations and the demand of foreign companies to be registered in the US if they sell products or services in the US. The picture is not blurry but there are many open-ended questions now in the hands of Obama-administration.