The Trickle Effect
After reading and watching a lot of what transpired after the economic disaster, many thoughts came to my mind. To what extent will this problem reach? and for how long? and what will have to be sacrificed?
I humbly submit my prediction of what may transpire.
Action - A backlash is brewing. People feel the unfair balance of wealth sink in. The answer is tax the rich more and maintain current taxes to the middle class or possibly reduce them.
Reaction - If taxes exceed to a point where it isn’t worth the investment, the rich(investors) will look somewhere else to invest.
Result - A short turn benefit ( possibly by the time his first term is coming to an end) from taxing the rich. A long term reduction in income tax due to the fleeing of capitol towards more attractive and equally stable countries.
Effect on other countries - Countries with strong economic ties to the U.S. will feel the pinch faster and deeper. Canada comes to mind, as it provides millions of barrels of oil a day to the U.S. and many, many other raw material from lumbar to minerals. Countries like China will be also feel a wave of financial pain, but may be able to use it to it’s advantage by slowing down the fast pace of it’s economy and readjust itself to a new world.
The U.S. is still an economic power able to produce millions of everything from oil to wheat to meat. America will have to re-prioritise its objectives and make her more attractive to investors to return as the super magnet it always was.
