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The US consumer is irreparably broken

The US consumer was the single largest contributor to the last global economic boom. Briefly after the onset of the GFC analysts and commentators would refer to the recovery coming when the US consumer recovered. As the realization set in of the predicament the US consumer was in this chatter soon faded. The ABC Consumer Comfort Index has not seen positive ground since March 2007.

Talk then turned to China. Is the Chinese economy large enough and growing strongly enough to counter balance the economic devastation in western economies. This talk again was false hope - for the US economy anyway. While China's unprecedented development will continue and be the major contributor towards world growth in the foreseeable future, this will mainly benefit economies that export materials and energy to China. Not many consumption based western economies like the US.

The world may never again be able to depend on the insatiable appetite of the US consumer. This is because, to put it plainly, the US consumer is broke. They have been crushed by the effects of tumbling asset values starting with house prices and spreading to their share market investments and debt levels so high that repayment capacity would even be in question if a miracle recovery was to occur.