Roadblocks to Recovery in America

The number one problem in this country is excessive debt, debt at all levels – the consumer, business and government.  Let’s face it – we have too much debt, both public and private, relative to the country’s gross domestic product (GDP). An increasing portion of this debt is unproductive or even counter-productive. In the simplest […]

The Next Economic Disaster Might be Closer Than You Think

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We are believers in the “from the outside in” principle of markets: When trouble starts, it nearly always does so out in the weaker periphery before creeping towards the core. We saw this in the run-up to the 2007 housing bubble collapse as sub-prime mortgages gave way before prime loans. You can see it again […]

Debt: Cheap and Easy

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Borrowing and lending is all the rage again. The financial crisis was five years ago this fall, and nobody is letting us forget it. According to ex-FDIC Chair Sheila Bair, financial soundness isn’t much improved. She says, “I think our system is still somewhat fragile, a lot more needs to be done.” Indeed… Wall Street […]

The US Fiscal Gap Is $200 Trillion… The Nation Is broke

While it is easy and often enjoyable to distract oneself with daily drudgery such as who will bomb whom (if not so enjoyable for those on the receiving end of said bombs), the key word in the sentence is just one: “distract” and as Kyle Bass pointed out correctly, the best, and most “economy-boosting” of […]

China Is Another Bubble Waiting to Pop

Most experts would agree that the biggest threat to the Chinese economy is a real estate bubble. Arguably, China has a massive housing and overbuilding bubble as can be seen on the chart below, showing the cement consumption per capita vs. GDP per capita. Of course, having a housing bubble does not mean China is […]