As O’Bummer’s term draws to an end, isn’t it funny, how you hear more and more, from former lefty zealots, that things are falling apart, headed for disaster, beginning of doomsday. Here’s the latest.
The US is not producing worldwide and is heading for a crisis similar to the one that is taking place in Venezuela, now under martial law. We are headed for a “state of disaster”, he said.
“What the Fed does at this particular stage is less important than what the markets are doing. And what the markets are beginning to show us is acceleration in money supply for the first time in a very long time… We have a global problem of a shortage in productivity growth and it’s not only the United States but it’s pretty much around the world and it’s being caused by the fact that the populations everywhere in the Western world, for example, are aging and we are not committing enough of our resources to fund that,” he said.
Long-term economic growth is the main problem.
“Our problem is not recession which is a short-term economic problem. I think you have a very profound long-term problem of economic growth at the time when the Western world, there is a very large migration from being a worker into being a of recipient of social benefits as it is called. And this is legally mandated in all of our countries. The size has got nothing to do with the rate of growth in economic activity, but if we stay down at the two percent economic growth in the United States and elsewhere, we’re not going to be able to fund what we are already legally obligated to spend,” he said.
Mr. Obama has not reached 3% growth once in the last eight years as he built up our welfare state. In fact, he has averaged 1.55% growth. The jobs he has created are low-skill and minimum wage jobs.
Our rate of capital investment as a percent of GDP is going down.
“Since 1975, the sum of gross domestic savings and entitlements as a percentage of GDP has been remarkably flat and what that tells us is all the way back to ’65 we have essentially been seeing a one Dollar to one Dollar tradeoff between entitlement growth and gross savings decline. And despite the fact that we are borrowing savings from abroad its’ kept our rate of capital investment as a percent of GDP going down,” he said.
Greenspan doesn’t like Hillary or Trump. He’s worried about trade. David Stockman will vote for Trump. He also sees a train wreck coming.
The disparity in income is because of Central banks that are out of control, printing money like no one ever imagined and who have created a massive worldwide financial inflation as a result, Stockman said. The people who own the stocks and bonds get the windfalls under these conditions.
He gave it context and also warned Americans. We cannot sustain this. Listen to Mr. Stockman on the link.