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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: Jim Willie CB who wrote (9583)3/6/2004 3:26:18 PM
From: Joe S Pack  Read Replies (1) of 110194
 
JW,
I agree with what you say. But I am not fully convinced about the following lines.

no immediate solution to jobs, as I have said many times
the solution requires a long painful recession
then jobs occur
from improved competitive position
from lower cost structure after bankruptcies
from reduced debt service load


Does it implicitly assume that we can create/recover all those lost manufacturing bases? I think it will be a long shot given that China, India, Mexico and other countries, who have higher population growth rate and growing education bases, want to manufacture at a fractional cost basis. IMHO, this recession will have to force peoples' standard of living to move way downward. Unless other over head costs go down competitive position is not assured even after a long recession.

Another real culprit is Washington's borrow-to-print-and-spend addiction. We also need a real recession hiting Washington and reducing the power of the FED.
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