flow5

Misunderstanding the Great Recession

Excellent discussion. You hit a home run.

Bernanke:

" A substantial body of research demonstrates that investments in education and training pay high rates of return to individuals and to society as a whole. Importantly, workforce skills can be improved not only through K-12 education, college, and graduate work but also through a variety of expeditious, market-based channels such as on-the-job training, coursework at community colleges and vocational schools, extension courses, and online training. An eclectic, market-responsive approach to increasing workforce skills is the most likely to be successful"

"From a macroeconomic standpoint, education is important because it is so directly linked to productivity, which, in turn, is the critical determinant of the overall standard of living"

"If we are to successfully navigate such challenges as the retirement of the baby-boom generation, advancing technology, and increasing globalization, we must work diligently to maintain the quality of our educational system where it is strong and strive to improve it where it is not"

Hyperinflation, Here We Come

There are various degrees of hyperinflation. The U.S. will experience a loss in the faith and credit of the Federal Government (unsupportable Federal Debt interest payments), followed by debt repudiation and the issuance of a new currency). There is no time table but at some point the increase in tax collections necessary to cover the Federal, State, & Local debt payments will be exhausted and all debt (public & private) will go into default.

And at the same time, a surfiet of Euro-dollars (dollar denominated assets) will cause a flight from the dollar and a economic catastrophe of unprecedented proportions. It is in no way inevitable but it seems the most probable outcome considering nothing, no nothing, is being done to avert this senario.