Well put case...only wish everyone would show the same level of self-thought.
Such analysis is all about gaining a fair measure...for example, the subprime mess is likely to result in no more than a very temporary .5-1% hit on US GDP...and I am talking maybe one quarter at most...if that.
In contrast, the recent 8% fall in the price of crude is likely to have an ongoing impact of some .25% on US GDP...that's quarter after quarter.
There is no question the US economy is not doing so well...in real terms on a globally comparitive basis, the US markets have actually been trending down for some time thanks to the falling US dollar.
In US$/gold terms, the DOW has performed even worse.
What this means...in real global terms...is that the influence of the US$ and by extention, the US economy is gradually declining...interestingly, at about the same rate that China is growing.
It seems the world "pie" is unchanged, just shifting about.
In this regard, the XAO is relatively lucky in that it has pretty much picked up...and then some...the resulting slack from the US.
Bottom line...the US is heading for an abyss of post Vientnam standards...and abyss mind you it needs in order to reassess current international policy to a more centric view...until then, they will keep chipping away at their foundations, robbing Peter to pay Paul...whilst being one propped up to the extreme by the gobal finacial "system", terrified of the implications of a US meltdown.
This will come...but it is a while off yet. The world needs to deconstruct the current "sytem" where the US$ has effective global control.
The rise of the Euro and a renewed focus on the gold standard will herald the beginning of the unwinding process...which in my mind will take at least 10 years to play out.
By contrast, current "activities" are nothing more than a roadkill induced reduction in travelling speed, as we travel along the road to oblivion.
We will be going much faster before we finally hit the wall.
We will not see it coming!
Cheers!
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