I learned a long long time ago that the vast majority posts/question here don't deserve a whole lot of my time or thoughtfulness.
It happens after a couple of years.
It happens after a couple of years.
Top Ten Reasons Recession Will Last "Forever"
- Thread starter ByLoSellHi
- Start date
Change.
I enjoyed your business as usual optimistic global trade is always wonderful view. But I find the Cornucopian view of permanent prosperity to have its faults. I will address your points later today. I am curious as to how you think we will ultimately address the deleveraging and credit contraction issues as well - home foreclosures, personal credit, CRE, and ultimately the shop till you drop permagrowth economic model the world runs on.
The chart I posted earlier in this thread also shows that each subsequent dollar of debt creation contributes an ever diminishing bump to GDP. Which tells me we have a monetary crisis on our hands as well.
I'll tell you what. Instead of posting some curve fitting chart...how about you post a linear regression "proving" your point. Charts are worthless. They can be manipulate to appear to be correlated. A linear regression on the other hand is a bit more telling. And don't "cherry pick" the data. Show a true random sample.
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1. OBAMA
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1. OBAMA
That's a lot of work... how about this article? I won't take it personally if you shoot holes thru it. I actually hope the writer is wrong.
http://seekingalpha.com/article/135566-jim-welsh-on-the-economy-past-the-point-of-no-return
Scroll to the middle of the article with the chart: Total Credit Market Debt outstanding/GDP Ratio.. and read thereafter.
Here it is:
Quote from tradestrong:
I have to laugh every time I hear somebody say this. Let's see...back in the 80's and the 70's when America was a net exporter and the world went into a deep recession....guess who that hurt the most? Yep....THE CREDITOR NATION. Being a creditor in a massive recession is NOT what you want to be. You are much better off being a debtor. You can inflate your way out of debt, but when your economy is completely tied to others paying you back, you're pretty much screwed.
Let's fast forward to today. When we come out of this recession, and the US which has the highest productivity in the world transforms into a saver nation, and all this demand happens all around the world that somehow is going to "hurt" the US, guess what will really happen?
A saving United States and a consuming Asia means nothing but a complete advantage for the US since we have the highest productivity and the ability to produce and invent. Let that dollar sink as the world demand skyrockets. Contrary to all the doomsday sayers...we are in the perfect position. Net debtor (we can inflate our way out)...high productivity capabilities, and a weak dollar due to our inflation which will make American goods much cheaper to produce overall.
I'm SOOOO shaking in fear.
I hear often that "we have the highest productivity and the ability to produce and invent". Yes we have a few Eienstein's around but look at employment (types and pay) of the populace please. And don't think the world isn't going to compete better, that's what globalization does, right?
Your dollar/ growth/ inflation scenario sounds plausable, but what do we produce best- food. So food prices will go through the roof. In this bad recession we are in they have not gone down (I go to the store).
No, here is what we are in a perfect position to do: Slap a tarriff on all imports to pay our deficit (think of it as a consumption tax on imports). If we can afford little metal trinkets we'll have to pay more, but we can make our own, and the dollar will go sky high (lower deficit), and we will be able to afford to feed ourselves (higher dollar), and the rest of the world can grow or go to hell or whatever.