Re: [OPE-L] Trade Deficit Disorder

From: Patrick Bond (pbond@MAIL.NGO.ZA)
Date: Sat Mar 18 2006 - 01:21:26 EST

----- Original Message -----
From: "Rakesh Bhandari" <bhandari@BERKELEY.EDU>
> The CAD may be a bigger problem for US's creditors than it is
> for the US!  As Susan Strange long ago pointed out in Mad Money
> (1998): the US can use "its bargaining power as military protector, or as
> interventionist meddler, or as major trading partner to get its own way
> and to
> make others undergo the painful adjustments."

Is there merit to re-examining the 1970s when the US transferred its
wreckage of the Bretton Woods currency system to Europe via exported
inflation, a lower dollar, the gold price explosion (and the $80 bn US
default on the $35/oz commitment) - before Volcker's 1979 shock? (And that
shock of course kicked off the Third World debt crisis and serious austerity
across the world.)

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