Date: Thu, 25 Sep 2008 18:55:57 -0700 (PDT)
From: Mervyn Lobo <[EMAIL PROTECTED]>
>
These? decisions are made on the following facts:
1) Bill Clinton left the US with a budget surplus of 560 BILLION dollars.
The?US treasury is now broke.
2) When?Clinton entered office, the Dow was at 3,300 points. When he left, it
was at 11,000 points.
3) We have had eight years of debauching of the value of the US dollar.
4) Increase in the supply of money?ALWAYS results in inflation.
5)?Both US presidential candidates?promise more of the McPain.?
>
Mario responds:
>
Folks, as a general rule, I never have a problem with a recommendation if the
person is following his or her own recommendations. That's the only true test
of whether someone is serious about their recommendations. If they are not,
then they're simply bloviating and their recommendations are meaningless.
>
In a previous life I was responsible for a $100 million corporate pension
fund. The only managers we hired to manage our funds were those who could show
us that they had become millionaires from investing their own money. These are
hard to find but they're out there. The theory was, "If you haven't made
yourself rich from your investing skills, why should I believe you will make a
lot of money for us?" This cuts through all the fancy presentations and tap
dancing that pension fund managers can put together.
>
Mervyn has previously told us that anyone taking a recommendation by him on
Goanet deserves their fate:-)) So he has already warned everyone:-))
>
However, I must say that finally, after several tries, Mervyn has listed some
recognizeable, albeit selective, facts, as well as some unrecognizeable ones,
and, as usual, without much context or perspective. Thankfully, he has given
up the absurd comparisons with the USSR and the Weimar Republic, though he is
still peddling his comical assertion that Bill Clinton had successfully and
singlehandedly "managed" the economy during his watch. In the US economic
system there is very little the President can do on his own. He doesn't even
have day to day control of the money supply which is the responsibility of
the independent Federal Reserve Bank.
>
To say the US Treasury is "now broke" seems to show an ignorance of the fact
that the US Treasury has been in a debt position for decades, underwritten by
the size of its considerable assets and GDP. The reason the US dollar has been
the lead currency for decades is because the US has always had a strong and
growing economy and has always been considered a safe place to invest for
investors from all over the world. The US GDP is at all time highs, and even
the larger projected deficits are at normal levels when related to the US GDP
at around 3%. As any rational observer would know, it has hardly been business
as usual for the US since 9/11.
>
When Clinton left office the US economy and the Dow were both declining.
Subsequently the Dow recovered and reached a high above 14,000, then declined
due to the currrent financial crisis caused by inappropriate real estate
lending practices by the banking industry, encouraged by some left wing
politicians who wanted low income Americans to be able to own their own homes.
The crisis is being addressed and will be corrected.
>
The increase in the money supply does not always lead to inflation if it is
offset by productivity increases. The US inflation rate if averaged over
several months is far below that of many industrial economies.
>
The two US presidential candidates have sharply opposing views of how to run
the US economy. Barack Obama is a virtual socialist, where John McCain is a
virtual capitalist.
>
