If I were ever forced to get married again, I believe I would marry the Kiplinger Report. It has never steered me wrong, it provides wonderful and exceedingly insightful information on the state of the economy, and it seems to genuinely care about what I care about the most….my money.
I just read this post by ING Money Manager Jim Griffin, and, as is usual, the article provides a clear, historically-based hypothesis on the near-future direction of the economy.
As I have said elsewhere in this blog, and, if I am to toot my own horn, I’ve been saying for the last 4 years, the US is heading for a painful inflation problem reminiscent of the 1970’s (I’ve been saying it mockingly since Bush and his troglodites were touting the “But there’s no inflation” line. Remember that one? It was a hoot!).
Now that we are clearly smack in the middle of said problem (go ahead and argue, perhaps you should look up the GAO’s surreptitiously changed accounting standards since that time), I wonder at the abilities of our myopic elected leaders to effectively navigate this crisis.
Have no doubt, it is a crisis.
As Mr. Griffen states in his article:
“The real purchasing power of incomes has been shriveled in the United States…by the doubling since last August of the price of crude oil. The result is a reduction in real incomes — a pay cut — for energy consumers around the world. “
Since we produce about 70-80% of the energy we consume, depending on which analysis you look at, we are inherently going to feel it in the wallet.
But, during all of this pain, Mr. Griffin believes that the Fed has a strong “institutional memory” and that the Fed has no desire to relive the embarrassment of the 1970’s debacle.
The end of the article may get a little too deep for the average economics 101 graduate, but the gist of the article is that we are paying for over-investment in domestic real estate while simultaneously suffering from the poor economic policies of other (unnamed but I assume he implied China) countries.
The article kind of felt like someone had started to crack a window on a painfully stuffy pity-party room.
(pic courtesy phoenixasap.com)
1st year law student busy reading the coming semester's texts. Aspiring politico. Internet businessman. Interested in the socio-cultural aspects of American society, changes that affect the "little guy", use of authority (and abuse of it), Intellectual Property law and Criminal Law. For added flavor, I also play drums in a trip-hop band.