David Smick,author of "The World is curved:Hidden dangers to the Global Economy"

Washington Post,January 12,2009 Page A13 published "Memo to the banks:Lend or else" by David M. Smick.

"Greenspan theorized that the paradigm shift that moved the 1980s toward greater optimism came largely from something unanticipated.

American consumers are undergoing long-term retrenchment. Consumption patterns may be returning to the lower levels of previous decades. That could mean that even $1 trilliion package may be far too small to do more than keep the contraction from worsening.

But there is a larger point. Economies are driven by more than numbers - the size of either stimulus spending or interest rate cuts. They are driven by PSYCHOLOGY. Americans see the US financial sytem and the larger global system as a bus racing down an icy mountain road toward a village - with no one behnd the wheel."

I enjoyed this article very much since such rationale is similar to my prior blogs.

On page A12 Professor of Economics Ransford Palmer wrote about the futre of US manufacturing:

"The solution is moving substantial parts of the industry to the South or to low-cost foreign sites,where US susbsidiaries are already producing cars more efficiently. " Such thought reminds me of General Motors investing $2 billion in Shanghai,China several years ago.

The above may be seen as a part and parcel of Sino-American economics in terms of globalization.

Francis Shieh a.k.a. Xie Shihao on Monday,January 12, 2009 at 10.18 a.m.