So far in this cycle, the Europeans have been the designated bag holders — clinging to their sound money policy while the US devalued and China used its peg to boost exports to the Eurozone. It been amazing to watch German industry compete in the face of these headwinds — but effectively they’ve used the sovereign debt crisis on their periphery to good advantage ie keeping their currency from a moonshot, even tho its strengthened this year.
Now the chickens are coming home to roost and either the euro implodes and Germany loses its Latin shell, or else the ECB will have to step in and buy all that dreck. The euro will decline a lot, and US exports will decline as a result. US-Chinese tensions will rise once more.
It looks like a recession is unfolding — it will be obvious in about 6 weeks methinks.
2012 is going to be a grim year in the US. As for BHO’s re-election, it will take a lot of propaganda bought with Wall Street donations to get him past the finish line.
The obvious move for the Left is to try to split the Tea Party movement (not the superstructure) towards left-wing populism.
If there were a Left…..