The impact of Y2k breakdowns on foreign trade could devastate the U S economy even if utilities, banks, transportation etc. still function due togreenspun.com : LUSENET : TimeBomb 2000 (Y2000) : One Thread
communications and payment problems overseas. For example China has a trade surplus (exports) of $50 Billion and their computers are obviously noncompliant. They have manufactured these products and if the stuff can not be ordered, payments can not be processed, shipping is disrupted, these impacts will snowball and disrupt the U S economy even if it is only a 2 here. New systems will be devised. It could happen that two way radios could be used to order the stuff if a way could be found to ship it and pay for it. It will be mass confusion until these new systems are developed if the communications system goes down. Parts for foreign made equipment could become difficult to get. We should stock up on what we know we will need. This may partly explain why the stock market is up this year due to sales for next year knowing about supply problems.
-- Steve (email@example.com), March 15, 1999
I agree, with the additional observation that exports are already down. Saw some USDA projections for farm exports and its already gloom and doom. Asia is cutting back on our goods, China "may" cut back further if we get huffy about that little "misunderstanding" re: stolen nuclear secrets, and it looks like we are starting a trade war with Europe. And now that Brazil and Argentina currencies have tanked, they can undercut our prices worldwide. There is a good possibility USA will no longer be the number 1 supplier of soybeans in the next couple of years - Brazil may be able to out-sell us (if they can ship).
Add a slight problem with a world-wide computer glitch on top of that. Not a pretty picture.
-- M (firstname.lastname@example.org), March 15, 1999.
Steve, Good post. Thanks.
M, Can't figure out why the US battles Europe over bananas. Do we need more illwill with allies? Maybe the notion is to get more internal cash flow for storm restoration in Central America. However, will cutting back the cash that Europe pays Carribean islands and others for bananas not crack up what is left of their economies. Is the gameplan to create more dependencies in this sphere on the backs of American taxpayers? Can you make any sense out of this fracas?
-- Watchful (email@example.com), March 15, 1999.
Factor in the European rebellion against Geneticically Modified foodstuffs, a billion dollar industry. Monsanto, a major profiteer from GM food, is in major financial trouble but has a US President in its pocket; British PM,Tony Blair, is risking his political future backing his friend, Bill. It ain't just about bananas.
This might be an interesting complication or a moot point in 290 days.
"Bad ideas flourish because they are in the interest of powerful groups."---Paul Krugman
-- Hallyx (Hallyx@aol.com), March 16, 1999.
The US has a pretty good reason to battle Europe over bananas. Europe's banana regime was set up to protect Europen banana importers from Latin American competition, which includes competition from American companies exporting from Latin America. Europeans have to pay an extraordinarily high price for bananas which is bad for European consumers, but most Europen governments are still willing to close ranks behind the "banana regime" because of special-interest influence, an increasing support for protectionism among socialist governments in Europe, and a fear of greater American influence. The European banana regime has been declared illegal by the WTO, yet the banana regime has been perpetuated with only minor modifications. If Europe is allowed to violate the rules or spirit of the WTO regarding opening markets to competition, then the WTO no longer serves a purpose, European protectionism will expand, and Europe will almost certainly continue increasing its trade surplus with the United States as a means of lowering Europe's unemployment rate. If Europe is able to bribe a favorable decision out of the WTO, the United States will no longer have any reason to participate in the organization and should certainly withdraw its membership.
-- Rick (firstname.lastname@example.org), March 16, 1999.
Most accurate, Rick. And if you were to substitute "anti-genetically-engineered-products faction" for every instance of "banana regime" in your post, it would be just as germane.
"I hope we shall crush in its birth the aristocracy of our monied corporations which dare already to challenge our government to a trial of strength, and bid defiance to the laws of our country." ---Thomas Jefferson
-- Hallyx (Hallyx@aol.com), March 16, 1999.