Join the Dots 314
1. The United States is living far beyond its means and its states and federal government are near bankruptcy, with around eleven trillion dollars of acknowledged debt.
2. The Chinese, Japanese, Koreans, and Sovereign funds are lending them most of the new money, and foreigners own around thirty per cent of the debt in total.
3. The United States is embarking on a huge spending programme, which will kick in after the worst of the deflation, which has not yet arrived. This spending programme will be inflationary.
4. China wants the lending tied to inflation in future, or it will push for a system based on a new global currency.