I will reiterate that there is great excitement in banking circles about the fiscal reform taking place [especially in Germany] in Europe.
They can get as giddy as they want about restructuring in Europe or Asia. They can praise European restructuring efforts until they're slap-happy.
But the underlying reality is that Europe has NEVER BEEN QUICK TO IMPLEMENT SUCH SUBSTANTIVE CHANGES.
And there is one more difference. The fact that most of these governments are unicameral parliamentary systems, they are much more attentive to their constituencies and unable to make the hard and difficult choices that pension reform requires.
Overlay the lethargic corporate mentality in the big industrial entities, and a relative lack of appreciation for entrepreneurialship overall, and I suspect the change will either have to be forcibly implemented from above, or drawn out for decades as a new generation of workers come into the system under different pension terms.
Either way, the global economy can only truly rely on the US economic engine for another 10 years, when many of our baby boomers retire, put their money in bonds, and look to preserving wealth, not making it.
As Harry Dent best puts it, the baby boomers are like a pig going through a python, and I have no illusions that everything will be hunky dory when they reach the "south end" of that python.
Regards,
Ron |
