We in the United States, and the rest of the world really need to come to terms with this. Unless there is a massive new discovery of gold, diamonds or sweet light crude oil in the US, our fundamental economics position has changed.

We lived for the past thirty years on the strength of our currency and on the imagined value of our assets. Whenever we wanted a thing we had only to sign a paper and the funds to buy that thing were ours. We had inexhaustible Debt Mines. We exploited them.

Now, although the dollar is still strong, the world is marking our assets to market. Their real values have proven to be less than our debts and it is unlikely that anyone will be lending any private individuals in the US much in the near future.

Which effectively kills the fine hopes of Mr. Summers and the other bankers in the administration. There is probably not going to be a renewed wave of consumer borrowing that can spur demand for domestic and world output. New debt and new debt backed securities will not revive our hedge funds and investment banks.

Most of us are getting this important change and we are saving more as a nation than we did before. If the administration and the banks can channel these savings into productive investments - infrastructure, profitable businesses, new ideas etc. - then we will be able to start rebuilding our economy. Maybe we will be back to a reasonable situation in time for Wonks Anonymous to retire.

But the change, a US economy that saves and finances most of its own development and growth, has global impact. For years the savers of the world, Germany, Japan and China, have preached thrift at the US while building their economies on selling us the means of our excessive consumption.

Sort of like the liquor companies running ads preaching responsible drinking.

The simple truth is this. The only way that a nation can maintain a trade surplus, short of giving its output away, is to accept paper for goods. It sounds nicer if you say money and bonds but these are just pretty names for paper. In our current situation our money and bonds are looking a lot like paper.

So the dollar will fall in value as the savers of the world get nervous. Wonks Anonymous will stand up and cheer because a lower valued dollar will make our products cheaper on the world market. At the same time it will discourage us from importing goods, including oil. We will need to make do with domestic products and domestic ideas.

The biggest sufferers in the transition will be the nations that have held on to their surpluses. Some of them, China and Japan, seem to be making attempts at domestic stimulus. Others, like Germany, are still waiting for the US to become the all purpose spendthrift nation once more so they can continue to provide it with goods and sermons.