This is how it works.
China and arab countries lend money to US to satisfy the apetite for money and consumption in a debt based economy.
This money is used to lend money to Americans for consumption, creating inflationary pressures.
But inflation is exported to poorer countries, where the poor suffer higher prices.
It is achieved via monetary policy of Federal Reserve that keeps dollar too high artificially.
But inflation also makes poor cheaper, sending US jobs overseas.
So you wonder where jobs are.
They are in poor countries.
Countries that were less affected by recession were those with nationalized banks, small and unimportant stock markets and those countries that have kept their workers cheaper.
US debt based economy should have had a dollar plunging long ago to rebalance US economy.
The proper level for plunging should make a chinese worker and an American worker to make about the same amount of money, which means loss of 14/15 of American's buying power. Not having dollar falling, makes jobs to go overseas.
Dollar fall also should mean devaluation of US debt and also reduction of trade deficit.
It also means that US should absorb the inflation it produces, and since Federal Reserve system and banking system is designed to be inflationary, what happens is that banks make profit, and Americans will lose buying power.
There are more technical and detailed explanations about why it happens.
But the simple lessons here are:
-By having debt no one becomes rich.
-Financial managers know that debt is used only for investments, not for consumption. People do not know that.
-US must act against its beliefs, because those beliefs caused the problem.
-There is a trade off between having geopolitical power and having jobs.
-Microeconomical vision caused the problem in the macroeconomical level. US citizen must learn macroeconomics.
-Poverty elsewhere means loss of jobs.
The apparent lack of money in a world awashed by money is caused because money supply is controlled by banks and banks are not lending until they cover their toxic assets. After banks are recovered, there is a risk of hyperinflation. Federal Reserve stopped informing the public about M3 indicator that was on the raise in 2006. The unbalance between production and amount of money suggests a horrible risk of hyperinflation in the horizont.
France funded wars, including US war of independence, that caused debt and deficit, that caused hyperinflation, and it triggered the French revolution.
Russia funded wars, that caused debt and deficit, that caused hyperinflation, and it triggered the soviet revolution.
Argentina funded Falkland's war, that caused debt and deficit, that caused hyperinflation of 1200%, and it triggered the riots and starvation of 1989.
Same happened with Chinese revolution.
Hyperinflation in 1923 after WWI also caused the Nazi revolution to raise in Germany.
The apparent recovery is nowadays fueled by government spending, but without fall of dollar and lack of transparency of Federal Reserve, it is just a bubble. This crisis has 2 aspects. One is the herd behavior of people and another is a systemic failure of the system. By telling people there is recovery, they get to prevent herd behavior, but the bubble problem is not solved.
You may like to see this. "Money is Debt"
http://video.google.com/videoplay?docid=-2550156453790090544#Or if you do not believe that, try this BBC documentary called "The ascent of money" by a Harvard University professor.
Episode 1: Dreams Of Avarice (A Financial History Of The World)
http://www.youtube.com/watch?v=oIe3-5GyopE&feature=PlayList&p=FEC454E538F8CE64&index=0Episode 2: Human Bondage (A Financial History Of The World)
http://www.youtube.com/watch?v=DvyRQlXoMA0&feature=PlayList&p=FEC454E538F8CE64&index=5Episode 3: Blowing Bubbles (A Financial History Of The World)
http://www.youtube.com/watch?v=9KIFSyEyv4g&feature=PlayList&p=FEC454E538F8CE64&index=10Episode 5: Safe As Houses (A Financial History Of The World)
http://www.youtube.com/watch?v=ajNffYAhILs&feature=PlayList&p=FEC454E538F8CE64&index=20Episode 6: Chimerica (A Financial History Of The World)
http://www.youtube.com/watch?v=usgHmRfYYQ8&feature=PlayList&p=FEC454E538F8CE64&index=25
