For all of the GLOOM AND DOOM about the state of the US economy, Greenspan does have one secret weapon....HIGHER RATES.
HIGHER RATES IN THE US WILL "CURE" MANY PERCIEVED ILLS....LIKE THE WEAK DOLLAR, AND POOR DEMAND FOR NEW BOND ISSUANCE.
But of course there is a downside.....SLOWER GROWTH AND AN ALTERNATIVE TO STOCK INVESTING......
Still in the VERY SHORT AND NARROW TERM some of these trends play off on each other positively.....demand for the dollar encourages Wall Street and boosts stocks.
When stocks sell off....bonds are bought and rates go down. etc. etc.
BUT FOR THE LONG TERM INVESTOR...THE MACRO ENVIRONMENT HAS TO BE TAKEN AS A WHOLE...A LITTLE "BIG PICTURE" THINKING IS NECESSARY.
TO WIT;
1. INTEREST RATES ARE GOING UP...AND THAT IS BAD FOR STOCK INVESTING.
2. THE DOLLAR IS STRUCTURALLY WEAK BECAUSE OF THE DEBT AND DEFICITS...AND HIGHER RATES WILL ONLY POSTPONE THE DAY OF RECKONING.
3. THE RISE OF CHINA AND INDIA IS NOT GOOD FOR COMMODITY PRICES...THEY ARE GOING UP AS MORE AND MORE PEOPLE OUTSIDE OF THE WEST SEEK MIDDLE CLASS STATUS.
4. THE AMERICAN IMPERIALIST WAR BUDGET WILL EVENTUALLY BANKRUPT THE NATION UNLESS THE PROGRESSIVES CAN REVERSE THE TREND AND USE THAT MONEY FOR DOMESTIC INTRASTRUCTURE AND OTHER INCENTIVES TO DO BUSINESS INSIDE THE US....LIKE NATIONAL HEALTH CARE FOR US EMPLOYERS.
ALL ECONOMIES ARE LOCAL....BUT THEY ARE ALSO LIKE THOSE RUSSIAN DOLLS THAT "NEST" ONE INSIDE THE OTHER.....THE LOCAL ECONOMY DEPENDS ON THE REGIONAL ECONOMY, THAT DEPENDS ON THE NATIONAL ECONOMY, THAT DEPENDS ON THE HEMISPHERIC ECONOMY AND TRADE BLOCS....
ALAS, THE TRULY GLOBAL ECONOMY IS A MYTH IN THE MINDS OF THE GREEDY INTERNATIONALISTS AND THEIR MEDIA SHILLS LIKE TOM FRIEDMAN AT THE NYTIMES...ETAL.
