FINANCIAL WARNING - AT 11:19 A.M. ET:  Given America's enormous debt, a good chunk of it owned by foreign nations, we should take warnings from those nations seriously.  From the Financial Times:

Germany’s new finance minister has echoed Chinese warnings about the growing threat of fresh global asset price bubbles, fuelled by low US interest rates and a weak dollar.

Wolfgang Schäuble’s comments highlight official concern in Europe that the risk of further financial market turbulence has been exacerbated by the exceptional steps taken by central banks and governments to combat the crisis.

Last weekend, Liu Mingkang, China’s banking regulator, criticised the US Federal Reserve for fuelling the “dollar carry-trade”, in which investors borrow dollars at ultra-low interest rates and invest in higher-yielding assets abroad.

COMMENT:   It isn't only foreign nations who are concerned.  A survey reported by Bloomberg several weeks ago revealed that Americans are increasingly disgusted by the financial gimmickry in the American economy, especially the high jinks they see on Wall Street.

We don't want socialism here.  It kills ingenuity, entrepreneurship and economic progress.  But if people turn against the economic system because of repeated systemic failures and what they see as smoke and mirrors, we can get it.  We can even vote it in.  We should be forewarned.

November 22, 2009