Caleb Lawrence – KPIG-KPYG Radio – Share the Wealth – December 19, 2016
The major averages opened higher but slipped late on little domestic news. Christine Lagarde gets convicted of negligence during her tenure as IMF or International Monetary Fund chairwomen, no punishment will be handed down of course. Also in Europe Italy’s banking crisis grows as the state will be forced to bail the banksters out again for their recklessness using taxpayer funds as per usual.
Container traffic out of Southern California increased in November on a rolling 12-month average basis imports gained .5% while exports added 1.1%. That said the graphs clearly show that trade has flatlined of late.
Many theories have been floated in an attempt to explain the post bust period of economic stagnation seen since 2007 despite trillions in quantitative easing and emergency level interest rates. I’m particularly fond of the debt saturation deflationary credit bust, lack of earned income explanation, these issues actually date to the mid 1980’s or so. The latest figures on domestic debt both public and private as per the IMF and using Federal Reserve data. Figures total debt is 62.5 trillion Dollars or 334% of GDP or Gross Domestic Product which works out to $196,000 for every man, woman, and child in the country.
A new paper from Stanford Researchers Nicholas Bloom and others shows that the return on investment from new ideas and innovation has declined steadily since the early 1990’s even as spending on research and development ballooned along with relevant staffing levels. The paper noted that this was seen with technology, agriculture, and healthcare amongst other sectors. Essentially, we are getting steadily less bang for our buck and going ever deeper into debt at the same time.