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Strategies & Market Trends : New US Economy Policy

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To: Arthur Tang who wrote (31)5/11/1997 10:04:00 AM
From: Arthur Tang   of 435
 
How the new economy started?

Our economy is always supplemented by supply side spending. The boom and bust 4 year cycle started with the election of the president and his policy of supply side spending. However, the limitation of spending can only create at most 1.5 years of boom. The rest of the 4 years are recessionary. To have a new economy means we have to control the demand side economy without the supply side changing spending. Congress has been holding the budget constant since 1992.

The demand side economy has been controlled centrally by fundamental theory of Alfred P. Sloan of General Motors fame. It is obsolescence and replacement. It is promoted by calling for 10% more productivity; by efficiency and quantity of products. Wall street analysts have been calling for 15% earnings improvement each year from all public corporations. 15% earnings improvement translates into 10% more productivity, and the need to plan obsolescence and replacement of products and services. Otherwise the economy will go into recession.

Now, we have agriculture fence to fence. Capacity of aircraft plants to be increase to 2000 planes/year. Housing industry to build up to 1 million new houses each year. The computer industry increasing capacity to replace all the slow computers. Travel industry is promoting economical costs to increase capacity; buy new planes, build more hotels, and resturents. Automobile industry is building foreign cars here in the US.

And the future is the world economy build up. We will use the learned lessons in distribution technology to bring the rest of the world prosperity with this new economy.
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