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United States—What Does the Future Hold?

 

The Washington Times of February 1, 1998, reported, “The United States is starting to take a hit from Asia’s deepening financial crisis, with American manufacturing reporting weakened demand, the Federal Reserve reported January 21.… Asia’s economic woes are expected to wash up on U.S. shores this spring. U.S. producers are braced for a flood of cheap cars, computers, semiconductors and other products from South Korea and the rest of Asia.… Economists predict the 1998 trade deficit to more than double from current levels, hitting between $250 billion and $300 billion.” In that same issue, another article quoted Senator Carl Levin, a Michigan Democrat, as saying, “If Japan tries to export its way out of this economic slowdown while keeping its markets effectively closed to competitive American products, then there’s going to be…a very severe reaction in the United States.”

In December 1997, factory orders in the United States took their sharpest monthly drop since 1991. Commodity prices on items such as oil, agricultural products, gold and aluminum “have plunged at a startling rate since last summer [1997], when the Asian turmoil began,” states the February 5 Wall Street Journal. “Damage is mounting fast in this economic sector that is often likened to a canary in a coal mine: an early-warning system for hazards that could eventually endanger the entire economy.”

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