The New Market Bubble Theory

I just read an article on Wired News called "The New Market Bubble Theory". The article is a summarization of a discussion with economist Harry S. Dent. Dent believes that the economy will go into a boom cycle for the next few years reminiscent of the late 90s. He believes that this bubble will burst in 2010 and will cause a much more severe downturn than the last recession that we saw. He says worse than the 1970s but not as bad as the Great Depression.

I am not sure that anyone can really tell what is going to happen in the future. If you could would you really need to make forecasts or would you be living on your own tropical island because you are a multi-gazillionaire. If you have the ability to tell the future, you should be investing or gambling.

On the other hand, the economy is cyclical. It does follow cycles. History has shown that every time we think that we have it under control, we don't.

My biggest issue with the forecasting the future is that you can't tell what the government will screw up or who they will upset. In most big downturns there is a very large political element (Hoover raising taxes during a downturn) or a drastic change world relations (OPEC embargo) that causes them. It is not purely cyclical, it is largely political.

"This Is A Remarkable Economy"

I just read an article in BusinessWeek with that as the title. Then there is the subtitle - "But President Bush isn't getting much credit for it, says Allan B. Hubbard, director of the National Economic Council"

Article

Why is it that the there is no discussion of how the tax cuts really did spark a growing economy?

Trade Deficit

This morning I read that the trade deficit has begun to narrow.

U.S. Trade Deficit Narrows Slightly

This is a good piece of information but of course the dreaded asterisk is added to the story. We still have the third highest deficit on record. Doesn't that stand to reason based on a theory called inflation?

There is another part of this article that really makes me question people's understanding of the economy. The article states: "The soaring trade deficits are being used by Democrats as evidence that President Bush's policies of striking free trade agreements around the world have failed to protect American workers from unfair competition from low-wage countries such as China. They blame the loss of 3 million U.S. manufacturing jobs since mid-2000 on trade liberalization policies that have allowed U.S. companies to move factories overseas." This statement makes no sense to me. Our unemployment rate still sits at very low levels compared to historical averages. Our economy has been creating jobs for the last two years. Lastly, the Democrats strongly support the union policies that make our workers unable to compete with foreign labor.

Just seems to me that the Democrats are playing on the fact that many don't understand economic numbers. What are your thoughts?

Conservatives call for return to values

This is a very good article that discusses the problems in Washington today. The Republicans are not following through on their ideas even though the people gave them the majorities that they claim that they needed to make changes happen.

Conservatives call for return to core Republican principles

What needs to happen in order for politicians to begin to realize that they can not take their positions for granted?

Founder's Quote 1/10/06

Today's Founders Quote from the PatriotPost really struck me this morning:

"The only foundation of a free Constitution, is pure Virtue, andif this cannot be inspired into our People, in a great Measure,than they have it now. They may change their Rulers, and theforms of Government, but they will not obtain a lasting Liberty."
-- John Adams (letter to Zabdiel Adams, 21 June 1776)
Reference: Our Sacred Honor, Bennett (371)`

Tax Parasites

I just read a very interesting post on The Reform Club blog:

The Reform Club: Democrats: Tax Parasites

My opinion is that people who are carrying the largest majority of the tax burden tend to be most interested in the candidate that wants to lower taxes. Then people who aren't paying taxes or are paying much smaller percentages tend to not be as concerned about the tax rates.

Then, the people who have the most to gain from social programs tend to follow the candidate who is promising the most free money. Again this tends to go against the people who are paying the taxes because whether politicians want to admit it or not the someone has to pay the bill.

Those concepts probably better define the difference in the red and blue states.

Dale Carnegie Quote

I just received this quote in an email and thought that it was so simple yet very powerful:

“Keep your mind open to change all the time. Welcome it. Court it. It is only by examining and reexamining your opinions and ideas that you can progress.”
- Dale Carnegie

Worlds Most Admired CEOs ranked by their peers

I just read this post on the Harvard Business School's website and found the results very interesting. The peers had a much different viewpoint than BusinessWeek's survey.

2005 World's Most Admired Chief Executives (Harvard Business School)

How can this allow us to improve ourselves?

Real Estate Venture Part 2

As I am sure some people know (although I didn't), many real estate investors in the U.S. function with the properties held in their name. The other option that I am finding, if you need financing, is to purchase the property in your name and then use a quit claim deed to pass ownership to your corporation. There are some issues with this but it appears that is how many handle the issue.