Post From Philosophy of Metrics
Reader Thoughts On “Aloha From The South China Sea
Hector Velasquez: Crude and real truth.Wonderful job JC.
Simon: Growth by currency devaluation. So I guess Krugman was right all along.
Simon: The price of liquid fuels the last ten years in the US should tell you the globalists have been playing the currency rebalancing game for too long and it’s not going to work anymore.
Devaluing the currency does not equal “growth” in any meaningful sense. It’s just inflation. Already oil at $100 a barrel for four years has cored out the US economy. Why do you think that is?
Simon Continues: Of course manufacturing will return in the long term, if there is a long term, but the transition from here to there will bring the US to the brink of revolution as it’s about to go through an IMF “internal devaluation.” But you don’t live here so there’s really no risk to your speculations now is there?
And US debt to GDP now versus post war is a useless measurement for crying out loud. The US had more cheap oil than Saudi back in the 1950s and the debt was used for building a massive manufacturing complex versus today which has been all consumption. It’s apples and oranges.
The 800-pound gorilla in the room that you and every other economist are ignoring is the scarcity of cheap energy, cheap energy on which the suburban-sprawling US economy was budgeted.
In all of your high-minded esoterica JC Collins you have forgotten the very simple lesson that at the end of the day supply and demand actually do matter. But keep up the cheerleading, why not, eh?
JC Collins: True esoterica is the opposite of high minded. Go America!
Daneackerman: When oil interest purposefully squelch cheap energy it’s a false projection of scarcity. Therefore, all that needs to be done is to weaken those who are squelching in order to right this wrong.
What’s the price of oil these days?
Let’s not forget the true concern here….which is not “cheap” energy but “clean” energy that is affordable. Seems like some folks are already working on that.
“INTRODUCING THE BREAKTHROUGH ENERGY COALITION”
“MISSION INNOVATION Accelerating the Clean Energy Revolution”
JC your glimmer of light in this dark time is very appreciated.
Safenet: People still have a hard time accepting the importance of debt/gdp parameter for US(and the necessary USD depreciation) and other economies as a whole, but you just can’t overstress the importance of it.
Here is an excerpt from IMF’s G20 surveillance note which confirms what you’ve been bringing into light for quite a while:
“In the United States, while the recent bipartisan fiscal agreements was an important positive step, further fiscal efforts are needed to stabilize the debt-to-GDP ratio in the medium term as interest rates gradually increase and the demographic transition intensifies”
The suggestions to emerging markets makes me think that inflation will be the primary anchor for all countries, I guess you mentioned that earlier too. On the otherhand doesn’t anchors to inflation make the dollar peg ends a foregone conclusion?