End of Era, Why?

I see the changes occurring in the USA as being caused by several key factors. In the past Era everything was financed by debt and credit expansion. The environment allowed fraud and corruption to creep into the system and made transactional profits become the key money making strategy for many of those that got rich. As we now see debt and credit collapsing the amount of transactions is collapsing with it. So goes all of the transactional money making opportunities. As a result people will have to do things and make things to make money.

Secondly, All of this debt has undermined the US Dollar, as tons of dollars were created in the credit and debt expansion. Furthermore, as we have seen our jobs outsourced and undermined by illegal workers, we have undercut the ability of the average American to earn income in a productive manner. We became a 'Service' economy, instead of a productive economy. As a result, our trade balance moved towards the very unbalanced state it is now in, where most things are made overseas. Chinamart (Walmart) is the premier example of this situation. Now, that we have seen the debt expansion ending, because we can't borrow any more, as a nation we are faced with a problem. We cannot increase national income by increasing debt, because our credit is tapped out. Everyone has run out of money to consume. Hence our service and consumption based economy is collapsing. The only path available is to become productive again. The only way to correct our trade balance and raise national income is to produce things that people around the world will want to buy from us. If we produce things they want, they will need US $ to purchase these goods. If we do not sell things overseas, then why would they need Dollars? If we fail to become more productive the US Dollar will fall, and all of us will see our incomes continue to fall. We have no choice as a country to become a producer again.

Some people say that in a globalized economy that we will have to allow our wages to become competitive with the Chinese and the Indians in order to become competitive again. I assert that we committed a critical error in the last 20-30 years as we allowed unfettered free trade access to countries such as China, India, and Japan to our markets. We allowed them to buy influence in our government and actually undermine the American worker. We gave them the access, we can take it back. We will have to become protective of our economy again to help us return to production of goods. Notice that Obama even talked about the importance of doubling our exports over the next 5 years in his State of the Union Speech. He recognizes the importance of Production in creating and growing National Income.

How can we help in this regard as citizens in our everyday life. Stop buying Chinese junk! Look for American products and buy them when able. It is time that we stop supporting our own demise. If you can't buy an American product, try not to buy at all. We need to start realizing that everything we buy from overseas helps keep some fellow American stuck in unemployment or some no-where service job. We need to start becoming Americans first, and consumers second. More to follow....