Foreign countries, especially Japan, which have succumbed to the worldwide slump have dumped money into the American economy, hoping to weather their own economic problems. But, this very money has flooded our economy and encouraged the consumption of a multitudinous SUV vehicles and luxury cars as if they sell at the cost of hamburgers. A recent trip to Montreal only further confirmed in my own mind that this explosion of opulence and consumption is a bizarre American phenomenon that will, finally, reach the abyss of collapse. Americans, today, are, indeed, living in an unreal world that those such as F. Scott Fitzgerald portrayed in the 1920's. So many are living beyond their means that the current indication of a drop off in consumer demand will likely escalate to such as collapse of the U.S. economy that the '30s may look tame in comparison.
Booms are peculiar beasts.
As Kindleberger well describes, they take on a life of their own and, as Harry Schutlze describes, are immune to comment or criticism. If this is over, then consumer spending will slump unlike anything we have experienced in the last few decades. While the bulk of the charges are related to a decision to discontinue home equity lending activities at The Money Store, the company is taking a number of other actions to reposition itself for the future. As a result, First Union has established a long-term core annual EPS growth goal after 2001 of 10 percent to 12 percent. Economic and market conditions that are adversely affecting core earnings include higher interest rate levels, soft capital markets for a number of securities products and services and weakness in parts of the health care industry.