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Wednesday, 29 March 03:04 (GMT -05:00)



Business And Politics News

American roller coaster or why the U.S.A. prospers while the rest world expects the default of the last super state.


 Analytical department of the “Market Leader” magazine and the U.S. Association of traders and investors headed by Rasul Zhalalov are investigating the situation to find out the main issue – will the U.S.A. collapse? On the one hand, mass media all around the world anticipate the coming default. On the other hand, the world community is fighting the second wave of crisis by helping the U.S. first of all. This is achieved by devaluing the national currencies. May be the scenario of the American economy that getting into dust has no alternative?

 
In the recent years it has become an old story to speak about the forthcoming economic collapse of the U.S. Dozens of books like «Deny of the empire?” or “End of American era” and movies (the brightest one by Peter Joseph “Zeitgeist”) has recently become public.
 
 
 
 
 
 
Some prophets like a British columnist Chen Akia foreseeing the nearest default of the U.S. that is to follow the way of the U.S.S.R. or Igor Panarin, a Russian professor, who anticipates the U.S. to be divided into six parts and 0.67 ruble per USD in 2010 were discussed by the professional traders and investors of Masterforex-V Academy not long ago.
And so, every year the U.S. is forecasted to follow the way of the super states like the Rome Empire, Holland and the U.K. And now, the U.S. President Barak Obama stated his nation should be cautious in order to not lose the world leadership.
 
Bad times. No doubts, the U.S. is not living in its best times now:
- increasing unemployment above 10%,
- budget deficit of $1,400 billion (10.8% of GDP, a possible critical line of the debt),
- tremendous inland debt (the Government debt of $12,000 billion, or 88% of GDP) which is growing by a quarter per annum, which turned the state into the largest debtor. Every U.S. citizen is owing 40,000$ to the rest of the world,
- significant devaluation of USD. It lose a quarter of its value since 1973,
- banking sector troubles. Effective as of 9M2009, number of banks in troubles tripled y-o-y,
- demand for real estate declines from 2007,
- speed of economic growth lowers. It was -2.4% GDP growth in 2009 (frankly, the EU experienced even larger drop in GDP levels: EU at -4.2%, Germany and Japan had – 5%),
- industrial output sectors are replaced by a sick financial industry. The U.S. became a leading industrial importer, and its financial sector’s share in GDP is larger than industrial’s one since middle 1990s.
 
The worst has gone.
Ok, The U.S., as many others, is in trouble. Firstly, we would like to mention that this process in not irreversible. The States were in even worse situations during the Great Depression or at the Vietnam campaign but managed to hold the leading position in the world. Secondly, Barak Obama Administration is working hard on its way to fight the crisis. Probably the results do not always fit the expectations, but the official statistics show the U.S. start growing.
The fundamentals of the rescue plan of the economy are the following:
- Government support of the financial and industrial sectors by $787 billion. This led to a great rise of the monetary base.
- Tax facilities of $38 billion. 95% of the U.S. households noticed a reasonable decline in tax pressure last year.
- new jobs are created.
- large banks have to support the small businesses. Obama initiated a $30 billion transfer from the Wall Street to the local banks in order to provide loans to local businesses.
- medicine and education expenditures raised.
 
The experts stated the U.S. economy leave the recession and start growing by 3.5% in 4Q2009, the recession lasted two years. The main reason of the good news is consumption growth, the household expenditures increased by 3.4% which is great fact for the last two years.
Barak Obama said he was full of optimism and the worst for the U.S. had gone.
 
The World leadership or what’s the fundamentals of the financial centre of the world?
In fact, the States have indeed very few common with a dying super state despite the forecasts of the analysts who never denies a business trip to the U.S. before writing their apocalyptic reports.
Pasul Zhalalov thinks that the States are still the major player in a wide range of basic vectors that can allow them to stay as the leader. The informational and analytical Department of Materforex-V Academy focuses your attention on the fact that the U.S. will be the super state until it controls for these factors.
Rasul Zhalalov suggests that the military and political leadership is the first factor. By now the U.S. has the most powerful army with an expected military budget of $700 billion in 2011.
- The defense budget of the EU is only 60% of the U.S. and its potential cannot reach 10% of the States level.
- The U.S.A. has 11 aircraft carriers (in contrast to 2 for Italy of the U.K., 1 for France, Spain and Russia) out of 285 marine ships of different types in the U.S. Navy. Its sky forces have 4000 aircrafts, 2000 cruise missiles and 450 intercontinental ballistic missiles.
Its possible enemies like the EU army are too young whereas the Russian army is too old to speak about them as competitors.
The Russian Federation is increasing its power but cannot compete with the U.S. fairly. It has 39% less of strategic bombardiers, 58% less missiles and 80% less submarine missile crafts than the Soviet Union had. It still has 608 carriers with 3000 nuclear missiles in the Navy and 367 silos with 1248 nuclear missiles in the land. It has also 23 thousand tanks.
China cannot be a reasonable competitor as well. It is only the third after the U.S. and the R.F. in terms of military equipment units with 1700 aircrafts, 240 nuclear carriers, 7500 tanks and 8 nuclear submarines. China has 144 marine ships but it is the only super state that has no carrier aircrafts. It will be possible to have the first one (aircrafts are the attacking military units) by 2020. It is the first in only the population of the Army – 2.3 million of officers and soldiers compared with 1.5 million U.S. warriors.
The second factor to keep the U.S. leadership is the scientific achievement. The U.S. admits it loses its leadership in this field, and Asian researchers have 2-4 times more investment in the technical progress. But still the States remains the leader in finance, research, software and internet, airspace, medicine and pharmacy, and a number of other industries.
The economic development is to be the third factor. The EU is the leader in GDP with $18 trillion, $14.4 trillion of the U.S. and $4 trillion for China in 2008, and the RF gained the second place among the European countries in 2009. At the same time we should keep in memory the fact that the EU is a union of 27 mostly developed states. This is just a union (applying the experience of Greece, Spain and Baltic countries that may collapse) whereas the U.S., the R.F. and China are unitary states with a defined vertical line of power.
The standards of the American miracle are to be the fourth factor.
The American miracle is the stylized fact in historiography. But the question of the fundamentals of the miracle is still open. The U.S. has:
- benefits from geography. The enemies are too far from the States.
- friendly neighbors. It has never increased its defense power by the expense of living standards as European and Asian countries did in the 19th and 20th centuries.
- rich mineral resources. The U.S. owns large deposits of ores, gold, oil, gas, coal and other resources.
- demographic policy. Its economy grew by inputs of cheap workers. It has 31 millions in 1860 and 300 million of habitants now. The population is growing and it is getting old slower than the European countries’ population. Its policy is targeted to increase population to 500 million in 2050.
- spirit of entrepreneurship and mind of novelty. A German sociologist M.Veber stated that the development of capitalism in the U.S. is due to Protestant faith of the colonists. This confession sees work as the action honored by the God.
- high industrial concentration. Banking capital in the U.S. is linked with the industrial plants.
- developed infrastructure. The government spends money on roads and railroads, electricity lines, phone lines etc.
- highly qualified high education.
- stable political system.
- democratic traditions that create a spirit of freedom and opportunities for the self-actualization. This all helps to solve the hardest questions by conversation.
- “ethnic house” as a result of cultural interactions. The Americans managed to accumulate the cultural experience of the former homeland citizens to solve the nation’s question (well, some extra efforts on the afroamerican questions were documented).
- federal state. A powerful federal government do not intervene significantly to the interstate problems and allow the local governments to run their policies.
 
What do we expect the U.S. dollar to be in the nearest future?
Analysts of the Masterforex-V Academy of trading, the best educational sourse of Forex trading in Europe according to ShowWorldFX 2009 exhibition, think that the USD is likely to go on gaining its value versus the rest world currencies at the second wave of the global financial crisis. The reason is that dollar remains the major currency in the unidirectional world with the centre in the U.S.
 
euro vs. dollar graph,1989-2010. “B-Yearly” wave is in process
 
dollar index graph, 1985-2010. a new bullish wave A-Mn3-4 after 93.0 level is crossed.
 
Long live the USA?
Well, there’s nothing eternal in this world. And the U.S. is not a unique chosen by the God state. One of fundamental principles of nowadays is rapidly changing forces in the world arena. The world leadership for ages cannot exit today. The CIA report “The major trends till 2025” says that the power of the States will eventually decline. And it has to leave the throne of the power one day.
The Association of Traders and Investors of Masterforex-V Academy suggests that the U.S. collapse forecasts of the experts will become true one day but it is a long way to that date.
 
The American Association head Rasul Zhalalov told that the U.S. is a weak super state only comparing to itself of the end of the World War II, but not weak comparing to its competitors. It looks as a falling empire to the only experts who never lived in the U.S. One can witness long lines to the U.S. Embassies all over the world, and the ambassadors can easily choose the best brains to work for the States economy. And the investors who collect data not talks on the U.S. should keep the last fact in mind.
 

The nearest followers (The EU, the RF, China and Japan) of the States just approach it, and fail to win in the branches which the U.S. remains the major leader in. And then, there is no alternative of the super states other than the U.S. by now.

 

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Soros, Rockefeller and Other Billionaires Ask U.S. Government to Raise Taxes for Them

The State of New York’s richest citizens – including some of the world’s richest families such as Soros, Rockefeller, Disney and others – have signed a petition to ask the local authorities to raise the taxes for the super-rich.

 

 
The extra money allocated as the result of those tax hikes are offered to be spend on schools, infrastructure, support for the homeless and other important things. The billionaires say that it’s time to invest in the long-term economic attractiveness of New York.
Publication date: 25 March 06:02 AM

Polish Defense Minister Calls Donald Tusk a Traitor

Not so long ago, Poland found itself in the middle of another political scandal. The thing is that the Polish Minister of Defense accused President of the European Council Donald Tusk in a diplomatic betrayal. For those of you who don’t know, Donald Tusk used to be the Prime Minister of Poland.
 
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Publication date: 24 March 09:48 AM

Candidate Macron Is Against Tighter Relations with Russia

Emmanuel Macron is a former French Minister of Economy and one of the candidates of the post of the President of France.  He thinks that France should be moving forward to tighter relations with the Russian Federation.
 

 

During the pre-election debates broadcast by TF1, Emmanuel Macron showed that he wouldn’t make friends with Moscow if he elected President of France. He thinks that France needs independence and tighter cooperation with fellow EU countries. He wants to make France stronger and more independent based on responsibility and real European policies.
 
Publication date: 24 March 12:49 AM

Russia's Become More Influential in the Middle East, Stratfor Says

According to Stratfor, a US-based private analytic company, Russia has really become more influential in the Middle East.
 
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Publication date: 23 March 09:32 AM

Evgeny Kiselev on 3 Years of Russia's Crimean Shame

For those of you who don’t know, a couple of days ago, Russia celebrated the 3rd anniversary of getting back the Crimea, which was essentially annexation. Evgeny Kiselev, a famous Russian journalist who later got the Ukrainian citizenship, decided to comment on the results of Russia’s annexation of the Crimea that took place 3 years ago.
 
Publication date: 23 March 04:27 AM

Europe Looks Helpless Under the Treat Coming from Russia, Experts Say

According to several experts, including Mikhail Samous, a military expert from Ukraine, at this point the entire Europe looks helpless when it comes to any possible threat coming from Russia.
 

 

To be more specific, Mikhail and his fellow experts assume that Europe has still failed to come up with efficient ways of resisting the kind of a hybrid war Russia has been waging in Ukraine, and even some other places around the world.

Publication date: 22 March 08:43 AM

Trump's in Search of Peaceful Conflict Resolution in Donbass

Donald Trump met with Angela Merkel. There are reported to have spent a lot of time discussing the situation in Ukraine.
 

 

Having talked to Angela Merkel, Donald Trump agreed with the idea of peaceful resolution of the Donbass conflict. However, he also gave everyone to understand that some other scenarios are possible as well. He said that ideally they are looking for the ways and means to resolve the conflict in a peaceful way.
Publication date: 22 March 02:54 AM

Queen Stats Brexit

From now on, the British government is allowed to start the so-called Brexit, i.e. the process of quitting the European Union for good. The thing is that the previously approved document aimed at starting the Brexit procedure is now signed by Queen Elizabeth II. This means that the British government has got a green light to implement the people’s will expressed during the corresponding referendum on June 23rd, 2016. From now on, there is no stopping Theresa may from starting the Brexit.

Publication date: 20 March 11:28 AM

It’s Necessary to Prevent Russia from Influencing the Balkans, Theresa May Says

According to British Prime Minister Theresa May, the Balkan states are in jeopardy. This threat is coming from Russia. That’s why she thinks that European leaders should establish tighter cooperation with those Balkan states that are not EU members to avoid letting Russia spread their influence over those states.

Publication date: 20 March 06:12 AM

Angela Merkel's Gonna Shed Some Light on the Situation in Ukraine for Donald Trump

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Publication date: 20 March 05:35 AM