LCACM

Historical Bull Market Returns, Duration Suggest More Upside for the Current Rally

In previous eras mentioned by the author, the US economy did not have to deal with intense low wage competition from Asian countries. The reason for the wage differences is perhaps the efficient family units that are common in Asia and fast disappearing in the West. The incremental cost per person in Asia is minimal, enabling Asians to accepts lower wages compared to Western employees.
This low wage competition is likely to impact US wages which in turn will negatively impact the US economy and the US stock market.

China Nixes Obama's Balanced Trade Rhetoric

The Chinese government is doing what is best for the Chinese billionaires as they don't need to get elected. In the US, as our politicians need large amounts of money to get elected they try to serve only the Billionaires who make election campaign contributions. These billionaires profit immensely from one sided trade using slave labor from Communist China.

U.S. Job Losses Demystified

The author and others are still stuck in classical economic thinking. Most of the classical economics developed at a time when large chunks of Asia were colonies and were not significant economic players. Now Asian economies are strong economic competitors and this fact should be considered when thinking of econmic policies. By and large, Asians have strong faith in their respective government and this is borne by the fact that the high growth economies of China and India have been guided by strong central government policies.
Considering the fact that Asian countries have been succesful using Government directed economies, US will need to rethink it's traditional Laisses Faire, anti-Government thinking, if it wants to survive economically.

Is the Bernanke Doctrine a Disaster?

Very good analysis by the author. However, Mr. Bernanke does not have a choice regarding what policy to follow considering the situation at hand. The US Industrial and Manufacturing base has been destroyed by multinational mega corporations by large scale transfer of companies overseas to to benefit from non-existent labor and environmental laws. This transfer of manufacturing to Communist China has primarily benefitted company CEOs/CFOS, at the cost of the company employees. To prevent further suffering amongst employess Mr. Bernanke has no choice but to inflate the economy by printing dollars.

Is the U.S. Headed Down the Same Path as Japan?

Japan was the first country to suffer the onslaught of unfair trade practices by Communist China. In a way Japan got a taste of their own medicine. Japan had been running trade surplusses with the West for a number of years but the Western countries were able to absorb this due to the relatively smaller size of the Japanese population. When China got into the fray with it's 1.3B slave workers, it saturated the marketplace leaving no room for Japanese exports. The bubbles happened in the housing market for 3 reasons. Firstly housing market is one of the most leveraged of all markets, so prone to problems. Secondly, housing was one of the few market which was relatively free of Chinese depredation . Thirdly the Chinese supplied the liquidity for the bubble by recycling the trade surplus dollars into financial instruments. Since the main driver for the fiasco is China not only US but other countries are likely to face a fate worse than that of the industrious Japanese.

What Does It Take to Become a Truly Competent Investor?

It is probably true that mathematics is not required for profitable Investing, as long as the other market participants are equally ignorant. A Sanskrit saying states "When in the company of fools, the learned should keep quiet"

Elliot Wave: The Dollar Is Set for a Major Rally

The Chinese keeping pumping out shoddy goods but US consumers purchase them because the goods are cheap, and alternatives have long disappeard. The US has the ability to pump out massive amounts of dollars and Chinese have no choice. but to accept them in exchange for their shoddy goods. Though each side complains about the other's cheating in this game, probably each side is convinced that it is the only game in town for them.

Forget BRIC: Your Portfolio Needs TICK

Investments are about the future and not about the present or the past. Of the 4 TICK Countries, Taiwan, Israel and Korea have dark geopolitical clouds and not much in terms of natural resources. Chile is the exception in that they don't have much geopolitical risk and the country has sizable natural resources.
Of the 4 BRICK countries, all four have significant natural resources and large internal markets. They do have current poliical risks, but not insurmounatble in comparison to their size/potential.

Trade Tensions Surfacing Between Emerging Markets of the Global South

Surprisingly the Indian government has done little to stem the dumping of Chinese goods on the Indian market. This is destroying numerous small scale industries in India and is likely to have a negative impact on Indian employment and economic growth.

The Socialist Calculation Problem and Regulation of Financial Markets

The author is writing based entirely on ideology that believes that it is impossible for the Governmeent to do anything properly. This thinking entirely ignores facts, and has directly contributed to financial deregulation and meltdown. As an example, Glass Steagall act had provided a firewall that had successfully prevented the greed of bankers from bringing down institutions where they worked. Financial lobbyist undid Glass Steagall and sure enough a financial meltdown follows. The author is critical of baby steps that the EC is trying to take towards the goal of accountability at financial firms. Baby steps always seem awkward, even those of a future ballerina.

Nasdaq Sale: Why Would Schapiro and FINRA Lie?

The author has done a superb job, exposing a very important issue. Looking forward to the next post.

U.S. Public Assault on Renminbi Peg Likely to Backfire

Since US is a trade deficit country, it cannot lose anything if Protectionism takes hold. On the contrary it will bring back jobs to the US. Not sure why Protecting jobs is bad when every nation is spending billions on Defense. In today's world, if a nation does not protect it's jobs and manufacturing base it will lack the wherewithal to Defend itself. So Protectionism is a strong component of national Defense.

American Austerity Is About to Begin

The author and several of the commentators seem to indicate that US citizens must suffer great economic hardship to placate the Free Market Deity. To change the current economic course, we need to first understand what brought us to the juncture of the economic meltdown.
US and other World economies have been sucked into the economic black-hole, first promised by Russia's Kruschev (en.wikipedia.org/wiki/...) in his "We will bury you" speech. It appears that the Communist threat has instead been made good by today's Communist China, using Free Trade as their weapon of choice. Corporate CEOs have been willing collaborators of the Communist regime, investing billions in China to shift manufacturing plants there.
Even if Americans started to save, CEOs would figure out a way to plough those savings into China, unless the US government takes steps to prevent that.

Opportunity in the Brazilian Real and Chinese Renminbi

The implication of the article is that China and Brazil seem to have very succesful economic models, and that Western Europe and US have economies that are slowly disintegrating. Is it time then to revisit our assumptions as to the types of political and economic structures that produce the most prosperity?

How Can We Get the Economy Back on Track?

The analysis by the author is excellent. The challenge is how to get the economists who dictate the national policy to upgrade their thinking. Conventional economic thinking has the goal of maximizing production subject to the resource supply constraints, and totally ignores the fact that due to the industrial / scientific revolutions the amount of goods produced, today far exceeds what the markets can absorb. The goal of new economic thinking should be maximization of jobs rather than production of goods. The following concrete steps can help to achieve to achieve this goal a) require all countries to institute a minimum wage structure to absorb surplus goods being produced. Imagine the surge in demand that would be produced if China/India were to institute a reasonable minimum wage. b) Institute the Export Certificates regimen suggested by none other than the legendary Warren Buffet,to slowly balance trade. Balanced trade is a must to ensure stability of demand. Currently it appears that overproduction by China is creating an economic black hole.