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Strategies & Market Trends : New US Economy Policy

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From: Arthur Tang11/9/2006 5:11:07 AM
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Economical growth under the new economy policy has been in practice since 1992 under George H.W. Bush.

Supermarkets were built up by 300% price increase(for slow movers). Then less than 50% cost give aways in door busters did a fine job of creating Jobs in the supermarket sector.

Then department stores were built up the same way. Automobiles were designed bigger and more expensive. And housing starts were hitting 875,000 per year in 1997. Today, housing starts are 2 million each year, but could slack off some due to seasonal adjustment, and lack of urban renewal projects.

In a mild recession, strip malls are still being built. And jobs are created. Some town with older building, not efficient for retail may have to rebuild because of prime location.

This economy builds on efficiency, and cash flow. No shortages are allowed. Quota of products and services remain in force to offer price and wage control. Wages go up when workers' hours are reduced to service only busy periods.

So far so good, cash flow is rotated from sector to sector. If Wall street goes back to rebuilding wealth by merger and acquisition to eliminate weak management wasting cash, then stock price will be good investment for long term such as 30 years.

Social security administration will be affordable if part time work is available to elderly retiree to supplement income.

Footnote:
After many years of zero population growth because of birth control pills. Having children has been encouraged started in 1991. This economical growth is based on modest population growth each year to suceed.
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