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U.S. debt crisis: Is the US facing a loss of confidence?

Harm Bandholz, Michael Menhart, Josef Braml, Bernd Weidensteiner, Eckhard Janeba
ifo Institut, München, 2011

ifo Schnelldienst, 2011, 64, Nr. 17, 03-21

Given the unresolved debt crisis in Europe, Harm Bandholz, UniCredit Bank, New York, believes that investors will continue to rely on tried and tested investments and will retain their confidence in US government bonds. For Michael Menhart, Munich RE, doubts remain about the long-term sustainability of the US growth model. However, focusing the discussion on the United States is not enough. For Josef Braml, Council on Foreign Relations (DGAP), Berlin, social and political conflicts will exacerbate the economic problems of the US, while Bernd Weidensteiner, Commerzbank, Frankfurt am Main, sees no debt crisis despite the increasing US financial burdens. According to Eckhard Janeba, University of Mannheim, economic difficulties are what lie behind the confidence problems in the US, which are causing confidence in the US to dwindle.

JEL Classification: G010,H630

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ifo Institut, München, 2011
in: ifo Schnelldienst, 2011, 64, Nr. 17