nova

Revisiting the Dow's Late 1930s Rally

The present US economic situation is much worse than in was back in 1930s. Then, the world was suffering from oversupply capacities. The USA was the number one industrial country with huge industrial and agriculture capabilities.

Later, these industrial capabilities would transform America into the post-WW2 superpower that would last for almost 65 years. Having such enormous industrial capabilities, America was destined for a super recovery.

The present situation is much different. During the last 20 years, America was in a dis-industrialized mode. It major industrial capabilities were deliberately outsourced to Asia. American political, economic and academic elite lost any brains they ever had. The new slogan was "post-industrial society". Only feeble-minded people could assume that society could prosper being in a parasitic consumption mode producing nothing of value.

One can only wonder how such bizarre situation could last for so long. There is one explanation to it: America military-industrial complex. US military and defence-industrial complex were dominated the world.

However, lately, thanks to Afghanistan and Iraq, America military-industrial complex started deteriorate quite rapidly. American economy is not in a positions to support America military superpower status any more.

At the same time, China, Japan, India, Russia and Brazil continue it rapid industrial & technological developments.
Further complicating US economic recovery.

US economic downfall clearly cries for changes. However, US political and economic elite cannot see and/or doesn't understand the situation. In my view, the present US situation reminds me more of the former Soviet Union late in 1990s. There is no Soviet Union anymore but there is Russia who emerged from a catastrophe similar to one the USA is heading to.