George’s Economic Bubble About to Burst?

Avoiding debt might be a very good idea.....

Economic ’Armageddon’ Predicted (23 November 2004)
http://www.truthout.org/docs_04/112804K.shtml
Stephen Roach, the chief economist at investment banking giant Morgan Stanley, has a public reputation for being bearish. But you should hear what he’s saying in private. Roach met select groups of fund managers downtown last week, including a group at Fidelity. His prediction: America has no better than a 10 percent chance of avoiding economic "Armageddon." Press were not allowed into the meetings. But the Herald has obtained a copy of Roach’s presentation. A stunned source who was at one meeting said, "it struck me how extreme he was - much more, it seemed to me, than in public."

Dollar Plunge, Specter of the Crash (22 November 2004)
http://www.truthout.org/docs_04/112904H.shtml
The dollar is falling again and will continue to fall. The direction is not really in question, but the manner, brutal or orderly, with or without a financial crisis, has not yet been determined. Let’s first review a few figures to get a good sense of the scale of the American problem. The current account deficit (the difference between what Americans import and what they export to the rest of the world) at a new historic record will represent about 5.4% of American income in 2004. Every year, the deficit must be financed by growth in net debt to the rest of the world. This now stands at around 2.6 trillion dollars, 23% of the United States’ income. In comparison, France’s net external position is a positive 7% of its income. (...) As with global warming, the Bush administration minimizes the risks so as not to have to take any action that might be politically costly. The chain reactions generated by a brutal freefall of the dollar, precipitated by the markets, might not, all the same, be very pretty. By pushing operators to sell American assets to avoid losses, such a dollar drop could precipitate a Stock Exchange fall, a brutal increase in interest rates, not to mention the failure of a certain number of financial institutions that had invested heavily in dollars. In cartoons, the hero continues along his trajectory above the abyss before suddenly falling straight down into it.

China and India starts dumping US Dollar and buy Euro Currency (November 27, 2004)
http://www.indiadaily.com/editorial/11-27-04.asp
The India, China and other countries have started dumping US Dollar quietly and buying Euro. That put a very serious pressure on US Dollar. Chinese and Indian central bank officials denied such reports. But Foreign exchange traders say they are quite convinced of Indian and Chinese moves. According some traders, there are many other countries specially oil rich Middle Eastern countries running away from dollar. (...) But the U.S. unit has declined sharply because of doubts about the fundamentals of the U.S. economy, which is running wide fiscal and trade deficits. It has fallen nearly 4.5 percent against the euro so far in 2004.