the issue is, again, once more, ad nauseaum, the usa trade, fiscal, and thus current account deficits flooding the world with money that must then be either recycled on the trade a/c or the capital a/c
it ain't going to happen by the trade account because burgers cannot be exported, especially if tainted by madcows
congress is now stuffing up the capital a/c by politicizing it
rolling back the dubai port deal is a bad idea
approving it in the first place is at least a politically bad idea, and at most a bad idea period, but once approved, then reversed, is a bad bad idea
so now what we have is a us dollar that is not good for us oil companies, nor good for us infrastructure, and may not be good for a slew of other aassets, including, possibly, airlines and shipping companies
if so, the usa assets are worth less, because potential bidders are fewer, and because the usa words are no good
if the usa words are no good on ports, then, the next natural question would be, are the words good on the treasury and agency bonds? etc
if not, the recycling machine gets gunked up
if the words are not good to the foreigners, then are the words good to the domestics?
and then ... according to the 1930 script, depressionville, and all loses
there is a reason why the russian ruble is not a global currency
and the us congress is squandering 200 years of work
i feel, suspect, and am pretty sure of
the answers, as usual and always, are 'gold', 'silver', 'uranium', 'coal', 'oil sands', a tight family, and real friends
i think the roadmarkers to watch for are ... (not in any particular order)
(i) tax rise (i.e. repeal of proposition 13 in california)
(ii) civil servants gets laid off (teachers, police, motor vehicle folks)
(iii) infrastructure not get repaired (more katrinas)
(iv) more people trying to grab at less moolah via officialdom action
(v) much higher long term rates and/or much higher real and officially-massaged inflation indices, either process happening first, followed by the other
(vi) much lower valuation of all assets, especially the leverage kind and type not producing adequate income flow
i am fairly sure we are heading towards some sort of financial crisis
chugs, j |
