Why are America and Americans in Financial Problem? Part I
President Bush on economic crisis
Financial problem America: Reasons behind
America is the richest country in the world. Americans are the richest. Are they satisfied? Are they actually happy? Ask any common American and the reply will probably be negative.
Americans are in economic crisis.They are in financial problem. Sub-prime crisis hits America severely. The USA is on the brink of recession.Though the recession is not yet started technically but America is actually experiencing the deadly face of recession.
Banks and financial institutes of America are cracking down. Sub-prime crisis has exposed financial problems and weaknesses of financial institutes. It is advisable to be prepared for financial shocks in American stock markets. I will not be surprised if some large financial institutes collapse, may it be Morgan Stanley, Merrill Lynch or Lehman brothers.
Merrill Lynch, Lehman brothers and Morgan Stanley
Apparent and actual reasons for economic crisis
There are apparent reasons of economic crisis and financial problem of America. People are discussing those apparent and temporary reasons and trying to control those aspects. Nevertheless, there are much deeper reasons than those apparent ones. They are overlooking actual reasons and causes behind the economic crisis and financial problem. Sometimes they cannot even understand. How can they know those internal aspects of permanent nature?
This is a million dollar question. The answer needs introspection. Every American need to Introspect whether they are politicians, policy makers, economists, social workers, sociologists, investors,job-seekers, hired or fired.
Is it because of terrorist attack 9/11 or Iraq war? Yes, these are some of the reasons, only some.
The secret history of 9/11 - full documentary
Effect of terrorist attack 9/11
The attack on the Twin towers of the World Trade Center was not merely an attack on the buildings. It was an attack on the ego of the Americans. It was also an attack on the American economy, an attack on a ruthless but continually progressing economy.
It had broken a myth, a myth that America is safe, a myth that no outsider can attack America and a myth that America is non-conquerable. It has shaken the faith of the common Americans. The fear factor is now haunting them. Where there is a fear there is a lack of confidence. The US citizens have started losing confidence in their Government, politicians, and bureaucrats. This is one of the causes of economic crisis and financial problem in America.
The attack has cost a lot to the Americans. Besides direct monetary losses, the American economy has witnessed huge indirect losses. It has enhanced security costs by many folds. It has slowed down movements of both people and goods. As a result, the economy has slowed down.
America is conceived as anti-Mohammedans after this attack. Whether America is anti-Muslim or not is a debatable question. However, It is conceived so. Osama- Bin-Laden and other fundamentalists urge to their community to boycott American goods that mean Americans are losing sizable part of its customer base. This is another cause of the economic crisis and financial problem in the US.
America has spent a lot in the Iraq war. Billions of dollars are drained for the purpose. These are tax-payers' money, spent in Iraq war. Iraq war is not yet reaching to a logical conclusion. It needs dollars till date, many many dollars of the common American taxpayers.
President Bush is losing his popularity that hit the lowest level since last fifty years. What is the reason? People say, it is Iraq war.
Debate on Iraq war
China and other factors
Asian economy has been in its boom led by China since ninety's. America had supported China by all means. America has placed China in the status of the most favored nation. China has got the biggest consumer market in the world. They have started manufacturing all types of consumer goods. They produced cheaply. They produced and exported the cheapest. China has dumped its products in America.
The American market is flooded with cheap Chinese consumer products. American consumer durable manufacturers lost their competitive edge against China. In turn, they started outsourcing their manufacturing jobs to China and other countries providing cheap labor. These cause job losses in America.
The growth rate in the US has started slowing down. Stock markets have already faced bad days. Investors are going out of the US in quest of a safe heaven. Many of them have started moving to Asian countries likes of China, India, Korea, Vietnam, Philippines, and Malaysia. All these cause the economic crisis and financial problem in America.
( This hub has been written in May 2008, so please read in that context.)
Warren Buffet - How to turn $40 into $ 5 Million
Was giving status of most favored nation to China a blonder for America?
Warren Buffet pulls out investment from America
I like to point out a very crucial and interesting point about Warren Buffet. He is the richest person in the world at present. He has pushed Bill Gates of Microsoft to the third position in the list of richest persons in the world. Despite his American nationality, Warren Buffet is not investing much in America. He pulled out the investment of approximately $ 20 billion from the American stock markets alone in the year 2006. A major portion of his portfolio is enriched with foreign stocks. Recently he visited Germany to find an opportunity to invest there.
The above mentioned are some of the reasons of slowing down American economy causing financial problems to common Americans. Will someone bailout American economy? Please view other reasons of economic crisis and financial problem of America in Part-2 of this article.
( This hub has been written in May 2008, so please read in that context.)
1. Please visit this link for the current situation on 7th June 2008.
2. President Obama has taken over the office of the President from George Bush. He has already spent more than hundred days in the White house. There is not much improvement in the economy as on 11 May 2009.
America and Americans are in serious economic crisis and financial problems. Why? How can they come out?....
Links economy and finance articles to beat crisis
- Comparison of Indian and American stock markets
Indian stock market has been performing much better than American from the very beginning. Investors in India has earned much more than America. A comparative study of both markets...
- Comparison India:Indian economy vs US, EU, Canada, China and world
India and Indian economy are growing faster than America, Canada, Japan and European union and viz a viz to China. A comparative study of the world economy with India.
- President Obama and economic crisis in America
Americans have elected Obama, a charismatic personality to deliver aspirations of common Americans hit by economic crisis. He declared his priorities as President-elect. He has to be innovative.
- Economic crisis in America: What are the root causes of problems?
The main reason for American economic crisis is bad spending habit, wrong political moves, and zero saving ratio. This is continued as third part of a well researched and mind boggling article.
- Economic crisis in America and top search words in internet
Look at the top 20 search words (items) on the internet in America and find how these affect your financial health....be financially intelligent to save yourself from the present financial crisis.
- Can India bail out America from present economic crisis?
The economic crisis and financial problems are in an alarming state. Who can save America and rest of the world from this terrible situation? Can potential of India be utilized in the interest of the world?
- Can India bail out America from economic crisis Part-2
How can India bail out America and rest of the world from present economic and financial crisis? Can it be done? Read the article and you can find reasons....