JimSmith - 8/28/2005 10:15 PM
Botnst - 8/28/2005 3:46 PM
Concurrence is possible with previous posters observations if we assume the near-term perspective. The sky is definitely in great jeopardy of a precipitous decline, if the forcing factors are such that other unforeseen pressures may transpire to effect an unknown solution.
Congressional Testimony by Chicken "Vining" Little, and Company.
It is kind of cute when Bot expresses his belief that if he wishes really hard for good things, they are more likely to happen, while, on the other hand, if he uses cold, calculated logic to assess a situation and it looks bad, it is more likely to turn out bad if he stops believing it will turn out good. I have just one question: do you cross your arms over your heaving chest to add to the cleavage and wiggle your nose as cutely as the little genie babe in the tv show?
Hey, I do economic forecasting for a living, so why listen to me. I've consistently predicted the general direction of the stock market and oil prices for you guys, and if you had taken my advice on where the dollar was going, you'd be rich Mr. Botnst. I can tell you in a nutshell exactly what is going on in the US economy - it is moving exactly as should be expected as the government executes policies to create a two-class society. One class is doing very well, and they are taking their tax savings and investing it in real estate, while the other class is having its brains beat out. The class that is doing well is doing well because the US government is essentially borrowing money from future generations to give to them in the form of tax cuts - the equivelant of a drunken sailor running up his kid's credit card. As a nation, we are no longer creating any real wealth, we are creating debt and paper illusions of wealth. The only thing we really export is war and death. Our ancestors created wealth, they did not borrow it. How long we can maintain this illusion of wealth by cashing in this country down at the government pawn shop is anyone's guess, but it will come to a crashing halt some day.
The danger is currently threefold: energy prices, over-investment in real estate and government debt. The core problem with the US economy is the internal combustion engine. We have an enormous fleet of automobiles that serve one horrendous purpose: to transfer ever larger amounts of cash from the American economy to unstable oil societies. This cash is increasingly being re-invested in Asia instead of in American debt. In fact, the Chinese peg their currency directly to the dollar because the dollar might as well be the official currency of China anyway - they are so awash in them thanks to Saudi investment and Walmart, we may soon see more paper dollars in circulation in China than in the US. In regards to real estate, like your personal finances, over-investment in only one sector is creating great risk in the economy because the investment is not diversified - little new money is flowing into stock equities from small investors, meaning money is being locked up in paper instead of being re-invested in true generators of economic wealth. So we have a real estate bubble, a stagnant stock market, and a government that is massively in debt. Those who think "the economy is wonderful" are about to find out that high energy prices are not only like a tax, it is going to be a tax we are going to pay to foreign governments, not to the US Treasury. This tax will cause the economy to slow, because it is a regressive tax that will hit those with lower incomes the hardest, and it is low-income people who form the core of the internal US economy. I cannot see it heading anywhere but to a sharp recession, probably after the heating bills are paid this winter.