Monday, December 08, 2008

Obama's Real Problem

That little graphic is Obama's REAL problem. If you think about it, the graphic tells you two things: 1) All the "GDP Growth" of the last several years (going back to ~1994) has actually been growth in DEBT; and 2) Issuing USTreasuries (taking on more debt) is only useful if there is a repayment plan, which necessarily is 'national profit.'

And 'national profit' is decidedly NOT financial-engineering, no matter what the MBA's tell you. It's profit from agriculture, industry, and invention (techno stuff.) Pace P-Mac and his mentor, John Stuart Mill, exporting profitable enterprises is not the solution, because only American labor (and inventiveness) will produce US profits--which are required to pay off Treasuries via tax revenues.

There's a lot more at the link, and it is not pretty to read.

HT: MarketTicker

1 comment:

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