The IMF says the age of America is over. It says that China will surpass the US by 2016 by GDP as a share of world purchasing power. Fold the tent, shut the doors, turn out the lights. The fat lady is warming up.
BOSTON (MarketWatch) — The International Monetary Fund has just dropped a bombshell, and nobody noticed.
For the first time, the international organization has set a date for the moment when the “Age of America” will end and the U.S. economy will be overtaken by that of China.
According to the latest IMF official forecasts, China's economy will surpass that of America in real terms in 2016 — just five years from now. Brett Arends looks at the implications for the U.S. dollar and the Treasury market.
And it’s a lot closer than you may think.
Put that in your calendar.
It provides a painful context for the budget wrangling taking place in Washington, D.C., right now. It raises enormous questions about what the international security system is going to look like in just a handful of years. And it casts a deepening cloud over both the U.S. dollar and the giant Treasury market, which have been propped up for decades by their privileged status as the liabilities of the world’s hegemonic power.
Don't take that as being written in stone. The IMF isn't the ultimate word on everything, and the future isn't unchangeable. This should be a wake up call though - the current path of out-of-control spending is not only unsustainable it is only a few years away from causing the United States to slip to #2 for the first time in seemingly forever. This is still a big deal and it is a problem that needs to be addressed by political leaders right now, or else by voters in 2012.
There's is still hope if we can get the Big Eared Marxist out of the White House next year!
ReplyDeleteThere's always hope, but that's the mission.
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