The first round of aid, the Government is nothing more than private sector debt will transfer to the government departments charged against, making the high welfare system for decades and round after round of Keynesian fiscal policy by the financial risks accumulated stand out, and finally to carry some European countries do not live in a solvency crisis first erupted.
Whoever it is, contraction of "deleveraging" is a rebalancing of the "dead end" and can not lead the economy to equilibrium.
"Deleveraging" passive savings generated by the savings rate is difficult to continue to improve and reduce the debt ratio. Because of passive saving (for the government to cut spending) led to decreased consumption, and then drag on corporate profits lead to rising unemployment, and ultimately lead to revenues shrink.
Quickly find new wealth model, relying on the rapid growth of the economy and taxes to solve the debt problem, of course could not be better, could be the next round of high growth in developed economies, the power source and the industry relies on where? The United States than all developing countries, factors of production, rather than some developed countries in the short term to improve the competitiveness of U.S. exports to adjust the price to become the financial elements of the simplest, most convenient strategic choice.
By lowering the interest rate prices, exchange price, making the U.S. factor prices in the near future better than the competition, resulting in comparative advantages, promote the influx of industrial investment and promote export growth, creating employment, improve income, thereby restoring consumption on economic stimulus.
Americans will continue to attempt to quantify the bottom line of loose, push the dollar up and down the consensus of the United States. This does not need any "conspiracy theory" is just a simple economic logic.
As for how much can play the role of quantitative easing, it is another level of issues, the Americans wanted to do something and it will do, whether you agree with the opposition.
This preference comes from Americans, the so-called "dollar's structural power." Because many of today's global economy, the formulation of rules and institutions with the dollar as a world currency is closely related to mechanisms of no interest to change this. Dollar expansion of the global economic system provides a credit basis, as the only driver of global economic growth "net demand" providers, it is bound to be U.S. global economic imbalances which embarked on a journey.
Division of the trade division of labor and financial deepening, the United States, emerging Asia, oil-producing countries to become the world's third pole of economic structural imbalances, the latter two categories of countries relying on export of cheap goods, services and resources to create a large number of "commodity dollar" and "petrodollars" to form a "dollar - U.S. commodities - oil dollars," the triangular relationship of supply and demand and the global division of labor to maintain the "delicate balance" on. Of the global economy once the U.S. dollar can not be decoupled with them, seems to be an irreversible process.
Americans from their self-confidence also has the world's most powerful financial institutions and financial services network, has the world's most active financial market, recognized by global financial rating agency, has a monopoly of the global accounting firms, the United States can control their own rule-making and coordination of international institutions (IMF, WB, ISB, etc.), making it in the international monetary system, the currency can be legally abandoned by the international obligations and the mechanism of exchange rate fluctuations can interfere with other country's economic, financial and even political affairs.
The current international monetary system has not yet to come to an end when the current prevalence of "decoupling" is actually false. I believe that the post-crisis era of the global economy will enter a long "low growth, low interest rates, high inflation" period and accumulated for the new round of crisis potential, but still hard to believe that the U.S. dollar will be crushed by the debt crisis itself.
Since April 2002 until today, the dollar has depreciated by 40%. Although the future of the dollar may strengthen certain times, but the long-term trend of depreciation of the dollar should not change.
Despite the crisis, the amount of days left toxic assets are being worn down the spirit of American families, blocking the intermediary's balance sheet, hamper the clean-up the real estate market. The private sector is no longer borrow money, banks no longer lending, the U.S. government's fiscal outlook full of dark clouds. But Europe, Japan into a "more rotten apples", emerging economies are struggling with the hot money and high inflation, the U.S. reversed to maximize the benefits they receive monetary hegemony, a lot of capital back into the United States, the share through predatory , leaving the market to get more U.S. government debt financing, long-term interest rates and bond buying by hedge down.
We may also be repeated after the crisis saw the dollar's weakness seems to have always maintained a certain controllable. The biggest risk from the weak U.S. dollar debt market, the return of rational expectations. So Bernanke and Geithner have been playing with the need for balancing. They are "evil", we must also continue to use various means to appease the outside world, the dollar continued rising disgust.
I believe the dollar will be irresponsible of the wrong policies of the global economy into turmoil for many years, until the stagnation of development, more likely outcome is out of control as the global currency devaluation, leaving the deep asset bubbles in emerging economies body trigger a new round of financial crisis
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