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News If The US falls

  1. May 14, 2006 #1
    I want to know what would happen if the US economy were to collapse.

    We are te richest country by far. Wha t impact would take place if we were no longer a superpower? Where would the money go, other first world countries,3rd world countries,the wealthy?
    Last edited by a moderator: May 14, 2006
  2. jcsd
  3. May 14, 2006 #2


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    well, the "money" wouldn't matter since the currency would be pretty devalued. The value of the US dollar is based solely on the impression of hte strength of hte US economy.
  4. May 14, 2006 #3


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    It cannot be said with specificity what economic collapse means— it is too wide of an area. Situations are too complex and too numerous I also think to try and guess what would happen.
  5. May 14, 2006 #4
    my guess is that europe union would take US's place as the economic superpower. actually, they're getting close even without US's economy collapsing.

    asia is also getting stronger - india's economy grows fast, and china is getting more power, now iran probably will make the pact with china which will increase their power even further.
    and dont forget russia, though its relatively weak now economically, it still has lots of natural resources in its vast land and a great economical growth potential.

    in short, if the US economy would fail, the world would feel the impact, but i think the void that this event would leave would quickly be filled.
    Last edited: May 14, 2006
  6. May 14, 2006 #5


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    I don't see how China could even sustain itself if the US economy went under, let alone thrive.
  7. May 14, 2006 #6

    You seem to think that all that economic growth is happening in a vacuum. If the US were to stop exporting jobs and importing products to and from asia, they would be hurt quite badly as well.
  8. May 14, 2006 #7
    thats why i said the EU would probably have the strongest economy, and not china.. that is if EU doesnt allready have a stronger economy... which is disputable.
    i think EU might get the lead anyway if it hasnt already, without US's economy crashing.

    as for china, i think china and the US affect each other almost at the same magnitude. (though the US is a bit less dependant, but only a bit).
    after all, the US is currently the second largest trade partner of china (20% of its export is to the US, and 14% if its import), and china is the third largest trade partner of the US. (when you consider both import and export traded)
    china exports to the US less then half of what US exports to china, and overall china exports more then it imports (about 15% more for 2006 so far), so yes, if the US would fall china would have a hard time getting rid of their merchandise, they'd probably sell more to the EU, japan and hong kong for less money, lots of people would probably lose their jobs. but then, lots of them wont.

    i dont think china would be ruind because of US's fall especially with china's recent acts of trade with saudy arabia (and maybe iran too), which might be important in a few years.
    Last edited: May 14, 2006
  9. May 14, 2006 #8
    The world's ecconmy would suffer too since the u.s is so ecconmically powerful
  10. May 14, 2006 #9
    im not saying the world wont feel a thing, ofcourse everyone will, the US is a very important country.
    but it wont crush the world's economy even if the US was no more.

    in my opinion the damage would be unobservable in less then five years in most places.
  11. May 14, 2006 #10


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    You're talking about a very large portion of the world's economy and a major currency being destroyed. 5 years? More like 50 years. The US economy is entangled into so many other countries that its unlikely any country would come out unscathed. Large portions of the middle east might be put back 30 years. Canada and Mexico would be hit hard by such a downfall as well
  12. May 14, 2006 #11
    China exports to Hong Kong? Hong Kong is China!
  13. May 14, 2006 #12
    Not exactally. Hong Kong use to apart of the U.K. before it returned to china controll in the early 90's I think. Right now I think it is apart of china but I think it is partialy self governed.
    Have you ever noticed how Hong Kong has it's own team sepreate for china's in the olympics?
  14. May 14, 2006 #13

    I hate to break the news, but the US is NOT the "richest country"
    In fact, we are the largest debtor nation in the entire world.

    "Rich" is when you have indigousness resources and exports which exceed import valuations. We are an import consumer nation which pays by credit. The US is broke.

    I will tell you this as a fact: If I conducted my financial affairs in the same way as the US, I would be arrested and thrown in jail.
  15. May 14, 2006 #14
    That's why if the US collapses many foregin banks would fail which would throw the world into another depression.
  16. May 14, 2006 #15


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    Palladin, imports and exports are only a small portion of the economy. If we pump oil from Alaska to sell in Ohio, that's wealth being generated in the country and it isn't part of your calculus.

    Besides that, I'm not sure you understand what a "trade deficit" is. It isn't like the federal government deficit. We aren't growing a "trade debt", it simply means that overall, goods flow into the country while money flows out. That money isn't necessarily borrowed and the goods that enter the country add value to the economy and the net worth of the people who bought the goods. Ie, if you buy a Honda Accord for $25K, that's $25k that flows out of the economy, but you haven't gotten $25k poorer - you now own a Honda Accord and have exactly the same net worth you had before! Even if you borrowed the $25k, most car loans are 5 years and you'll pay it off anyway.

    Because the economy is constantly having money pumped into it (about $10 trillion a year), we could have a trade deficit forever and never actually become broke. That's why economists are split on whether a trade deficit is even really that bad a thing.
    Last edited: May 14, 2006
  17. May 14, 2006 #16
    Russ, as always I do appreciate and value your comments, but I must disagree with you in this case.

    If you, as an individual, have more "imports" than your valuation "exports" can sustain, you have a negative net balance.
  18. May 14, 2006 #17

    Small? The wealth of a nation(or individual) is directly tied to how much they have to substantively offer versus how much they receive.
  19. May 14, 2006 #18
    If I externally "flow" 10-trillon dollars into Pakistan, does that make Pakistan rich?
    Not if that money is not spent on developing some type of vauled product/sevices that Pakistan EXPORTS.
  20. May 14, 2006 #19
  21. May 14, 2006 #20
    One aspect is that the US has a formidable fallback; It's military might and it's global socio/political influence.
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