11-26-2004, 03:24 AM
<b>Economic `Armageddon' predicted</b>
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->In a nutshell, Roach's argument is that America's record trade deficit means the dollar will keep falling. To keep foreigners buying T-bills and prevent a resulting rise in inflation, Federal Reserve Chairman Alan Greenspan will be forced to raise interest rates further and faster than he wants.
   The result: U.S. consumers, who are in debt up to their eyeballs, will get pounded.
   Less a case of ``Armageddon,'' maybe, than of a ``Perfect Storm.''
   Roach marshalled alarming facts to support his argument.
   To finance its current account deficit with the rest of the world, he said, America has to import $2.6 billion in cash. Every working day.
   That is an amazing 80 percent of the entire world's net savings<!--QuoteEnd--><!--QuoteEEnd-->
<!--QuoteBegin-->QUOTE<!--QuoteEBegin-->In a nutshell, Roach's argument is that America's record trade deficit means the dollar will keep falling. To keep foreigners buying T-bills and prevent a resulting rise in inflation, Federal Reserve Chairman Alan Greenspan will be forced to raise interest rates further and faster than he wants.
   The result: U.S. consumers, who are in debt up to their eyeballs, will get pounded.
   Less a case of ``Armageddon,'' maybe, than of a ``Perfect Storm.''
   Roach marshalled alarming facts to support his argument.
   To finance its current account deficit with the rest of the world, he said, America has to import $2.6 billion in cash. Every working day.
   That is an amazing 80 percent of the entire world's net savings<!--QuoteEnd--><!--QuoteEEnd-->