The secret of US Economy - 美国经济的秘密

They can buy things like clothes, make-up化妆品 etc, without asking their parents for money.  They can eat in nice restaurants, have nice parties and have a nice travel...  Moreover, American culture is TV culture.  The purpose目的 of most US media媒体 is to "educate" people to spend money and have fun from their spending. It makes more sense for teenagers to spend money and enjoy their young lives.  My husband, Tommy, had over $30,000 debt when I met him at the age 26.  Well, keep that in mind, this is quite common in US.  As we can see, a lot of buying and selling is constantly经常地 pushing the US economy forward.   Last year, since US economy is going downhill after the housing bubble, people are afraid to spend and have started putting their money in the banks now.  This reaction影响 slows down the economy's growth.   Last month, The US Federal Reserve Bank slashed interest rates利息, and yesterday they signaled暗示 for more rate cuts in the future...

US Fed Chief signals He's Open to More Rate Cuts

WASHINGTON -- Having already slashed降 short-term短期 interest rates利息 by almost half几乎一半 since August自从八月, the chairman of the Federal Reserve, Ben S. Bernanke, signaled暗示 on Wednesday that more rate cuts降息 -- which is to say more cheap money -- may lie ahead.

Mr. Bernanke's assumption设想, 假定 is that slowing economic growth will reduce inflationary通货膨胀的 pressures压力 in the months ahead月初, because debt-laden consumers消费者 will be far more wary小心的 of spending money and businesses will be more cautious谨慎的 about investing in more plant and equipment设备.

But the success成功 or failure失败 of the Fed's strategy策划 could depend依赖 on something outside Mr. Bernanke's immediate及时 control: foreign外国人的 confidence信心 in the American dollar and foreign willingness自愿 to keep financing the United States' huge external外部的 debt.

The dollar has plunged使陷入 against most major currencies流通 since the Federal Reserve first began cutting interest rates in September, and slipped to another all-time low against the euro欧元 after Mr. Bernanke's testimony声明 on Wednesday to the House Financial Services Committee委员会.

A weak dollar tends趋向于 to boost促进 American exports出口 by making them cheaper便宜 in foreign外国 markets市场, but it also pushes up inflation胀大 by raising提高 the cost花费 of foreign imports进口. And while the United States buys oil in dollars, many analysts contend声称 that part of the recent最近的 run-up上涨 in oil prices油价 is tied to the steadily稳定地 declining衰退中的 value of the dollar.

Over the long haul, the bigger worry for Mr. Bernanke may not be import进口 prices价格 as much as interest rates and the dollar's value. While the Fed has direct control over overnight interest rates, long-term interest rates for mortgages抵押 and business商业 purposes目的 are affected被影响 in large measure by the flow of trillions万亿 of dollars in cheap foreign money.

Foreign capital inflows流入 were a crucial严厉的 contributor贡献者 to the boom in housing prices and the persistence持续的 of low mortgage rates even after the Fed raised rates in 2004. If capital flows are now slower, or come with higher demands, mortgage rates are likely to stay high even if the Fed cuts its benchmark rate.

NYTimes