Deficit

How long can the United States continue to run the extraordinary deficits of recent years and pay a price such as that paid by Argentina in 2001? Most economists would say -- not long at all. Here is a piece from Salon that well describes the problem. The massive cost of the Iraq war contribute heavily to the deficit and it is easily forgotten that the US had huge economic support from the Saudis and others in the 'first Iraq war'.

Releasing the Yuan from a dollar peg will do little to solve the underlying problem of a nation that is spending vastly in excess of its income. A slight hiccup in the debt market, a lack of buying interest could easily start the dominos.