>Not true. East Asia and the EU+Switzerland have been pretty equal lenders;
the ECB's figures on the Eurozone's capital account surplus make this
clear. In the early 1990s, Japan bought lots of US assets, but in the late
1990s it was Eurofirms making acquisitions.
But certainly Japan has been among the primary lenders. You might add that the recirculating money doesn't just finance the US trade deficits, it feeds high equity valuations in the US and it finances things like a 400 billion dollar a year national security state.
>>Second point: H&L say, "The Japanese domestic market itself could not act
as the engine of growth as long as real wages lagged behind productivity
growth."
>Again, not so. Credit growth can make up the difference indefinitely, as
was the case during the US Bubble.
I'm not sure I follow Dennis's point. Nothing is indefinite. Certainly bubbles built on credit growth never are.
>>Point 3: H&L say, "Germany was able to protect the profits realized abroad
from the devaluation of the dollar by using its hegemony in Europe. "
>Hegemony, my foot. The EC taxed the rich and spent on poor countries,
internal social democracy boosted wages, and the EC later became the EU,
which even invented a multinational bank, the EIB, to finance its periphery.
All achievements of the Central European working-class, not the cybernetic
spiders of Deutsche Bank, spinning their money-webs.
I think the timeframe of the article on this point is more modern than Dennis's. Certainly Germany's policies toward Yugoslavia were an all-time post-war fuck up. Germany is clearly better protected from the ravages of US trade policy because it is connected to the EU in a primary way.
Charles Jannuzi