The health of U.S. has been on the rocks ever since the Gramm-Rudmann-Hollings Law was amended/scrapped by President Bush. The Repercussions on the Consumer/Common man on the street will be felt when the Debt Servicing gets to above 3 Percent of GDP. which it already is. That means inflation will follow for the next 5-7 years followed by a Period of Stagflation possibly 3 years i.e. I see Interest rates back above double digits in 7-10 years. with the economy performing poorly. Recession should show its indication from 2009. Outflow of investments should pick up speed 2009 onwards. Bankruptcies to double in the next 5 years. Unemployment to double in next 5 years. The USD to FALL , the Stock market to Fall to 7,000 levels . The banking sector to lead the way as FDIC doesn’t have enough money to bail out a Top 20 US Bank. The Blame (I Feel) goes ALL to US Congress-Senate especially PRESIDENT BUSH for his policies to gain Votes and popularity NOW at the cost of the Future of the US People as the Consumer/Common people in USA will feel the HIT 5-7 years down the road in a Big way. First Recession followed by Stagflation after 3-5 years will and should be hitting the economy in 2009 onwards as the
Sub-Prime Mortgage crises is ONLY the forewarning of worse gloom and doom to follow.

UNLESS AND UNTIL THE TWIN DEFICITS ARE CONTROLLED NAMELY BUDGET AND TRADE DEFICITS THEN IF DEVALUATION OF THE DOLLAR ON A MASSIVE SCALE PLUS SPENDING CUTS ARE CARRIED OUT THE BALOON WILL BURST SOONER RATHER THAN LATER SPELLING GLOOM AND DOOM ON A FAR MASSIVE SCALE THAN 1929 (GREAT DEPRESSION).

Who is going to Bail out the USA ? EU ? World Bank ? IMF ? Japan ? China ? Who ???

Have your forgotten that the Governement has increased TAX on OIL and is earning Billions every year and even then the situation is worsening.

Note what I have written down now as Time will tell you IF I am right or wrong. Today 08 July 2008.
(This is my analysis and my own working)

Regards
Kamal Ahmad Khan
Analyst/Consultant
0092-300-2209309

F.Y.I Barack Obama says he will stop giving tax breaks to companies like this.

“When you owe the bank $100,000, it’s your problem. When you owe the bank $100,000,000,000, it’s the BANK’S problem.”

Short of nationalism, it is in the interest (no pun intended) of government holders of US debt to see the dollar strong, and its current downward trend is killing them. It’s almost like a tax and tariff rolled into one!