Thursday, December 30, 2010
$700 Billion or $7 Trillion?
Will the $700 billion bailout save the U.S. economy? The answer is “NO!” In 1990s, the Japanese property bubble burst cost taxpayers about $3 trillion (with Japan’s GDP about $4 trillion) and took more than 15 years to clean up the mess in the Japanese economy. Today, the subprime loan crisis could potentially cost the American taxpayer something like $5 or $6 trillion (with the U.S.’s GDP about $10 trillion). Some economists have openly suggested that the American crisis will need around $10 trillion (Ohmae Ken’ichi’s article in Japan Times, 2 October 2008) to clean up. No way, the American taxpayers will support another $7 trillion bill to pass the congress. An international rescue might be needed; however, George W. Bush has not made many friends during his eight-years in office. If there is the international rescue plan, certainly China, the oil-rich Gulf states, or even EU, will be hesitate help finance the plan. But, with one exception, only one idiotic country will be willing to provide money to the plan. That is, no other than Japan!!