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Strategies & Market Trends : New US Economy Policy

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From: Arthur Tang10/12/2006 4:27:07 AM
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Communism and capitalism living together in the new economy ?

Communism is very simple. The government supplies all merchandises for the people and offers free education and jobs to pay for the living standard. The trouble is often the bureaucrats did not plan a higher standard of living.

The new communism started on the wrong foot allowing free enterprise with limited capital. These free enterprises often go bankrupt.

In Europe, it has been nationalisation of large industries, socialism short of full communism. then later privatize again(15% privatization, 85% ownership by government). Airbus looks like has to be nationalized in Brussels by the EU government, buying out the local governments who no longer can print money.

In people's republic of China, experimentation of privatization had been done for more than 15 years, since government owned companies privatized with the help of Goldman Sachs on Wall street. The stock prices have been well maintained. The fact that Chinese government can print money and regulate the business management and market wise made capitalism safe in a communist country. 1929 crash will never happen in a communist country?

Currently Wall street is going back to mergers and acquisitions. A practice that was highly successful in the Banking industry. Reduction of banks created many successful smaller banks occupying the older bank facilities and prosper on local depositors near those facilities. Size does matter in the stability of banks in the US. But its locations, locations and locations that brings value to real estate and local business successes.

Happily, Wall street should look at communism(severe socialism) for the federal government and Wall street capitalism build on large corporations acquiring smaller businesses using franchised stores for distribution. Supply chain software to control price and production capacity from manufacturing plants. Fanny Mae and Freddie Mae already owned most of the mortgages. This country is going communism in its own way. Will GM and Ford be nationalized, it is only a matter of time.
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