Tuesday, July 19, 2011

Can we just try to escape the web?

John Mauldin is a very widely followed investment analyst in the financial community.  He's a big picture guy and profusive writer.  John has a massive database of followers to whom he sends weekly emails.  Yesterday's missive from John was an eye opener,  and real downer.   He shared a research piece written by Lacy Hunt of Hoisington Asset Management.  You can read it here.

The bottom line?  Our economy is like an insect caught in a spider web,  with no hope of escape.  We're just waiting to be devoured.  Its only a matter of when.   According to Lacy, we got here through a combination of errors that got us into this mess,  and another combination of errors that made our situation worse in trying to escape.  Our mistakes are both Republican and Democratic.  There is little hope in being able to escape the ultimate pain that is to come.

The main problems? We stupidly cut income taxes (Republican).  And we more stupidly relied on inefficient government spending to get us out of this mess (Democratic).

While the conclusion of this article is that we've come too far to escape our demise,  I have to wonder,  why not at least attempt to reverse both problems? Why can't we both raise income taxes,  and cut spending? Our Democratic President seems ready to get that done.  But our Republican politicians are as stubborn as jackasses.   And the spider is on its way.

North Carolina deserves better than Republican Senator Richard Burr.

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