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Strategies & Market Trends : Booms, Busts, and Recoveries
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To: energyplay who wrote (50757)6/6/2004 5:30:07 PM
From: Seeker of Truth  Read Replies (4) of 74559
 
Hi EP,
I agree with some of your points but I think they are less strong factors than you think. For example there is not much demand for US goods other than grains and weapons. I don't see how the moderate fall in the US dollar that has happened will have any major influence on the balance of payments. I do agree that some of this money is flowing out to US companies that are hiding their profits oveseas. The amount may indeed be enormous.
I always wonder whether investments in these pension plans that you mention is or is not included in the savings rate of the US citizens. I hear both sides on this.
The employment rate of the population is not too bad if the 5.6% is the truth. This is a lying administration so we have to deduct something on grounds of suspicion. The question is whether it is a temporary increase caused by defense spending and giveaway interest rates or is something less fleeting. I remember World War II. On the home front everyone had a job and most people were very optimistic about the economy. There was a problem that you couldn't buy any big ticket items; they simply were not being produced. People were piling up savings in the form of War Bonds. My point is that defense spending on a huge scale can indeed cause the appearance of prosperity but it is only the appearance. The salaries of those in the defense industries do not represent any new wealth, if the stuff was not sold to a foreign country.

JMHO. Personally I've battened down the hatches and don't own any US stocks. That may not protect me much.
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