Wednesday, December 17, 2008

Production/Export Economies Still Strong

While the service/consumer countries of the world are mired in deep economic recession, production/export economies like Vietnam's continue to flourish. Even with the US, Europe, and Japan in recession, and commodity prices down, Vietnam expects to grow 6.5%.

The only stable basis for long term stability is an industrial, productive, wealth-generating economy. We must never lose sight of these basic economic facts, and the sooner we reformulate our national economic policies, the sooner we will leave this Depression.

Instead of addressing these foundational facts, our leaders' current policy is to paper over the current problems with an inflated money-supply, and jack up long-term debt. Thank goodness at least this one Senator, Max Baucus, is talking about protecting our economy and way of life.

Vietnam -- whose major exports include oil, textiles, rice and coffee -- predicts about 6.5 percent economic growth this year, down from last year's 8.5 percent, amid falling demand in foreign markets and lower commodity prices. Last year Vietnam's exports to the United States, its largest foreign market, topped 10 billion dollars, while Vietnam only imported US goods worth 1.7 billion dollars, said the state-run General Statistics Office here.

Export-led economies such as Vietnam should rely less on trade with the United States and more on stimulating their internal markets for economic growth, a senior US senator said Wednesday. "The United States has to boost its own economy and consumption" amid the global downturn, Max Baucus, chairman of the Senate Finance Committee, told a press conference during a visit to Hanoi, the capital of the communist country. "We urge export countries seriously to move away from policies that focus so much on exports and instead to focus on local consumption." Baucus added: "We also have to address the large imbalance of trade between the United States and Vietnam," calling it "a trend that cannot be maintained."

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