[Winston]

This in my opinion is a nice example of financial terrorism. Now that lending is more expensive I'll be interested to see how this will affect home owners, businesses and pensions in the U.S. Sadly I feel it will erode the middle class even more as more businesses go under unable to matian the there debts. More jobs off to China and more poor people in the US.
I fear this is the way some people might want it, goods manufactured in the developing economies while financial and banking 'industries' in the west. If you pay your workers less overseas then theoretically the population benefits from cheaper products.

However who will be left to buy these goods? Manufacturing and farming are down in the UK. 1.2% and I think *0.8% respectivly dispite the disapointing 0.2% Growth reported last fortnight. Hmm I guess the next quarter will be down to and for why? Are there any shortage of resorces? Perhaps a shortage of workers? Well no, nothing like that. Not yet anyway. So what does that leave as the culprit in the failing economies of the west. Globalization is not working and euro is falling apart as the wealth moves away from the developed economies and the smaller economies face the crunch first.

To be frank I don't think there is much anyone can realisticly do in the face of Globalization. Money and investment will move to the most efficient production environments, the developing world. Workers in developed nations will have to except lower pay and fewer rights in order to compete with that. Indeed 'tis the very definition of the word Economy, to produce goods at the lowest price.

In the past western countries would have the benefit of 'the invisible hand' keeping investment home but now with markets so internationalised... It's like investing in renewable energy while there is still coal and oil in the ground, we all know it would help toward energy independence but as long as there is more money in oil and coal we'll go on using it.