Let's go back to Stockman's graph:
Again, he red line is the production of USA as a nation, the output of the means of production, since 1981. You may click on it to make it larger.
Now the nature of what we produced has certainly changed since 1981, we now produce much more in services and far less by manufacturing. In any event, the blue line represents the claims on the productive capacity of the USA. In my earlier post I note there is no way the assets themselves can ever satisfy the claims. The coming bust will to some degree adjust the claims, and politicians will pick winners and losers, as usual.
People desiring topics upon which to write masters theses and phd dissertations ought to consider a few possibilities:
1. To what degree did the mal-credit introduced in the 1970s lead to malinvestment and misallocation resulting in what changes in the red line asset allocation?
2. To what degree did the tax-avoidance Roth IRA and other retirement plans that require investment funds be dragooned into an extremely narrow range of assets help blow up the bubble the blue line represents?
3. How much of the space between the blue line and the red line might have funded small business expansion absent mal-credit and dragoon investment options?
4. A scary thought, but how much is the nominal obligations of the welfare/warfare state is in addition to the claims represented by the blue line on the red line? For all claims of any sort relating to USA as a country are against the red line, ultimately.
We currently borrow 1/2 of what we spend to keep this going, demonstrating clearly the red line cannot support even the tax burden of the nation. What cannot continue will eventually stop.
What starting up your own business does is makes YOUR blue line even lower than your red line as you extend credit to customers, and legally escape the confiscations coming while simple sidestepping the fight of all those claims on those dwindling assets.
Feel free to forward this by email to three of your friends.
Again, he red line is the production of USA as a nation, the output of the means of production, since 1981. You may click on it to make it larger.
Now the nature of what we produced has certainly changed since 1981, we now produce much more in services and far less by manufacturing. In any event, the blue line represents the claims on the productive capacity of the USA. In my earlier post I note there is no way the assets themselves can ever satisfy the claims. The coming bust will to some degree adjust the claims, and politicians will pick winners and losers, as usual.
People desiring topics upon which to write masters theses and phd dissertations ought to consider a few possibilities:
1. To what degree did the mal-credit introduced in the 1970s lead to malinvestment and misallocation resulting in what changes in the red line asset allocation?
2. To what degree did the tax-avoidance Roth IRA and other retirement plans that require investment funds be dragooned into an extremely narrow range of assets help blow up the bubble the blue line represents?
3. How much of the space between the blue line and the red line might have funded small business expansion absent mal-credit and dragoon investment options?
4. A scary thought, but how much is the nominal obligations of the welfare/warfare state is in addition to the claims represented by the blue line on the red line? For all claims of any sort relating to USA as a country are against the red line, ultimately.
We currently borrow 1/2 of what we spend to keep this going, demonstrating clearly the red line cannot support even the tax burden of the nation. What cannot continue will eventually stop.
What starting up your own business does is makes YOUR blue line even lower than your red line as you extend credit to customers, and legally escape the confiscations coming while simple sidestepping the fight of all those claims on those dwindling assets.
Feel free to forward this by email to three of your friends.
0 comments:
Post a Comment