There's a "secret" hidden on the US dollar bill! And, it's NOT a treasure map...............
Today's NYT has some excellent coverage of the economy and markets in a special outlook section on US business, and an advertising section on commercial real estate. I usually treat "advertising sections" with contempt and skepticisim but this one is good. It's a keeper. I almost want to buy a REIT after reading it.
The real estate people are not denying that rates are going up and the consumer is loaded with debt, and they state as much, but they make the argument that the sky isn't falling and that reasonable returns are still possible, especially in certain markets like NYC. Kudos for honesty and even handedness.
The Outlook Section is more ominous.
Essentially the US is simply ignoring a whole raft of serious problems that are now starting to bite. The aritcle "We Pledge Allegiance to the Mall" is worth reading. It notes that, unlike Eurolanders, Americans drive to the Mall in their cars, and so can carry more stuff home than Europeans who mostly walk or take public transportation! Hmmmm....I always wondered about that! So that's why we "over-consume." The discussion on how America doesn't produce things anymore and has become "consumer-in-chief" for the world economy is a little scary.
Stephen Roach of Morgan Stanley is quoted as saying: "We outsource everything except consumption, and that is not sustainable much longer." etc.
There is also discussion of the Credit Card Culture in America, the health care disaster, and the China Bubble.
Net-Net there are more problems than answers, and the problems are really serious ones, not just stuff that is made up by the punditacracy to sell newspapers and fill dead air space on TV.
Finally, there is a note about Mr Greenspans legacy. Frankly, I think Greenspan will go down in history was one of the worst shams and scammers since John Law and the Mississippi Bubble in France, c 1720!
Greenspan will leave a TOTAL MESS to who ever follows him! And, some "legacy" that will be.
Unless the PRODUCTION-CONSUMPTION PUZZLE is solved and solved rationally, those holding dollars now will soon be reading on the backs of their greenbacks: " E PLURIBUS SCREWUM!"
