Mounting deficits spark US economy jitters
Gaping US trade and budget deficits and a weak auction of government debt that pushed interest rates higher pointed to a bumpy road to recovery for the world's largest economy on Wednesday. A Federal Reserve report noting businesses see some signs of moderation in the contraction, even though conditions were weak or deteriorated further in May, failed to ease anxiety about the economy. Instead, financial markets found new reasons to worry that massive government spending and Fed cash infusions will lead to dangerous inflation and undercut any fledgling rebound.
Note EU-Digest: European Union countries in March rejected calls by U.S. officials and European trade unions to increase spending further to boost growth. Earlier this month, German Chancellor Angela Merkel criticized Britain and the United States over the amount they're spending on stimulus programs. When talking about root causes of the economic crises everybody agrees that the problems in U.S. economy has played the biggest role in causing the crises,so it seems somewhat illogical for the EU to listen or to copy the US remedies to solving the financial crises.
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