Barak Obama the World Leader and the Foreclosure Crisis

Washington has on its side some advantages. It reacted rapidly and positively to save the economy from collapse. Even if on the U.S. shoulders the foreclosure crisis hit, they were all those who have found a solution to what seemed to be difficult.

President Barack Obama, despite accusations brought and challenges, which had to cope with them, is indubitably the most important leader on the world stage by security, coherence, and knowledge to give evidence. While in Britain, Japan, Germany, and France leaders are either put on the wall or categorized as inconsistent and reserved Obama remains in position. The only dreaded competitor, the Chinese leader, Hu Jintao, has no aspirations of world leader and it is not supported in this position because the world still do not conceive the idea of a Chinese to occupy this position. Only the American model seems to be viable. The world would need a leadership in front of such difficult problems and in case of prolonged uncertainty. Any progress, even if it can slow the decline rate, is associated with enthusiasm.

Despite the fact that more and more states ask a stronger intervention of the state in the economy to prevent a new foreclosure crisis, and doubt of the Anglo-Saxon’s model of capitalism, this was the system that brought prosperity to the whole world for over three decades. All the world states have benefited if the money amount decreases and world trade is flourishing. Although it is difficult to go back in time to the periods of growth, lack of other visions makes the U.S. the best solution.

How will America look after the foreclosure crisis? The U.S. must move from a model based on consumption to one based on exports and savings, in terms of the last decades in the engine of growth of the largest economies in the world has been intern consumption. Current recession has brought the spotlight on the gaps existing model and the need to impose a change in the area of the U.S. economy, reports Newsweek.
For 60 years, strategies relate to a series of simple tools to struggle with the foreclosure crisis and to encourage growth: the reduction of the reference’s profit by Fed, diminishing taxes by the government and lack of instruction of Wall Street that helps the obtaining of gains easier. Now these tools are outdated. Fed cannot reduce more the interest of the monetary policy in conditions in which the interest rate for overnight loans is almost zero. Deficits are at a record level, and the democrats are in power in Washington, so the chances of major tax cuts decrease.

The returning from previous crises relates to bubbles, based on consumption and they led to raising of inequalities, specified Lawrence Summers, the economic advisor of the White House. The President put emphasis on another time of the economy’s recovery. Obama administration strategy relates to what represents industrial policy and excessive government intervention – or even gradual expansion of socialism.

                                                

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