Quote Originally Posted by Schmedlap View Post
The first part of that is correct. The second half is false. Demand is not created by an abudance of supply.

You seem to misunderstand either me or the concept of demand. Demand is dependent on price level. Excess supply = lower prices = broadened base of customers.
Let's say Americans don't buy Sony Playstation xy from China anymore. Sony cannot sell their Playstations as before and reduces the price. Lots of other customers can suddenly afford the Playstation xy.
Now add that the money isn't transferred to the USA as loan, but remains outside. In the end, Sony might even sell its Playstation xy for the old/same price to new customers.

A severe economic downturn in the US in all likelihood translates into a dramatic global economic downturn, as well, impacting the disposable income of the people who live elsewhere.
Yeah, yeah. That's the mantra of the TV reports about financial markets.
It's a short-term phenomenon, might last for probably two years, maybe as few as six months.
The USA simply has no such lever to ruin the real markets global economy.