The economy seems to be sputtering, luckily I have found two experts that know more than I to talk about whats going on. The first is the always interesting Paul Krugman

He thinks our economy has been the beneficiary of a lot of foreign investment:

In particular, third world economies…were shaken by a series of financial crises beginning in 1997…they abruptly switched from being destinations for capital to sources of capital, as their governments began accumulating huge precautionary hoards of overseas assets.

The result, said Mr. Bernanke, was a “global saving glut”: lots of money, all dressed up with nowhere to go…

In the end, most of that money went to the United States. All of this was right, except for one thing: U.S. financial markets, it turns out, were characterized less by sophistication than by sophistry, which my dictionary defines as “a deliberately invalid argument displaying ingenuity in reasoning in the hope of deceiving someone.” E.g., “Repackaging dubious loans into collateralized debt obligations creates a lot of perfectly safe, AAA assets that will never go bad.”

…Directly or indirectly, capital flowing into America from global investors ended up financing a housing-and-credit bubble that has now burst, with painful consequences.

What does this mean for us? After the jump, a different view:

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