China exports more than 32% of its production to the US and a slowdown in the American economy would have a grave impact on the manufacturers in China. Production would slow down in some factories while others might have to close down altogether. This would result in a large portion of the workforce being out of work. The automobile industry of Japan is heavily reliant on the American consumers because the around Japan exports around 23% of its production to the US. Again, a slowdown in the US economy would have a devastating impact on the Japanese manufacturing sector. To earn the best grades in writing Business Plans, Case Studies and work assignments in you should choose an academic writing service that will meet your best writing needs
Added to that, many Japanese companies have subsidiaries in the US which would be immediately and directly affected because then the mother companies would not want to invest in the US economy since their margins would be considerably reduced. The export sectors are literally the lifeline of the economies of both countries. Every major industry has thousands of vendors who supply accessories and parts which go into the completion of any product. When the parent companies are not producing, a lot of vendors would automatically have to go out of business because of the intense competition for the work that is available.
The reasons for this are the financing of the global war on terrorism, and the growth of major economies in Asia are making it difficult for the US to borrow money at reasonable interest rates. The world is fast consuming its natural resources and with the depletion of these resources, the cost of producing and marketing is also increasing. The depletion of these natural resources is also increasing prices with many countries bidding for limited resources. As the world moves into alternative sources of renewable energy such as solar energy there will a negative impact on most economies followed by the expected growth phase.
The major between economic indicators of the past and now is globalization where the economy of every country in one way or another to the US economy which means that the US is more likely to be affected by events in other countries than it was in the past. American debt is mainly in the form of Treasury bonds which have been bought by other countries, most notably China and Japan. The current US debt is 14.29 trillion dollars out which $6.2 trillion is held by the US government. This is divided among various entities such as 2.7tn is in Social Security trust funds while other US government agencies have 1.9 trillion and the Federal Reserve Systems has 1.6 trillion dollars. The largest public debt holder in Treasury bond is China that has 1.3 trillion dollars in treasury bonds.