talks about... you might have noticed that just about everything you buy isn’t as good as it once was. Like the size of a Hershey bar. Or the thickness of the cloth in your Brooks Brothers shirt. Or, one of my favorite examples, the quality of America’s passenger airline fleet. To grow profits, companies have had to focus on making their products cheaper and cheaper. That’s one of the many hidden signs of the big problem with America’s financial system. I’ve never seen any country in the world actually become wealthy without building a nicer and nicer passenger fleet. Look at Singapore Airlines. Or the new carriers in the United Arab Send us a message, question, or criticism at feedback@americanconsequences.com
Porter Stansberry comment: Well, yes... I’m sure the changes I believe are coming will threaten the powerful in Washington and in New York. But, trust me, the “swamp” will protect itself. The wolves will feast. Just as they profited enormously from the bailouts of 2009, by knowing how policies are going to change they will front-run the country. Meanwhile, the sheep will be sheared. Me? I’m just trying to be a good sheep dog. But I already know that most sheep won’t listen. My opinion? This growth in debt is a “band- aid” to keep the consumer economy humming while wages are racing to the bottom. Obviously not a sustainable scenario. When the implosion occurs, it will make the housing market collapse look like a hiccup. – Rodney Roberts Porter Stansberry comment: Wages haven’t kept up with productivity gains but profits have. How? You’re pointing to one very important factor: leverage. Both consumers and corporations have used debt. Consumers use it to buy the things they need, like housing and college. And businesses use it to grow their profits even as returns on assets declines. And there’s another way that corporate America has managed the relative decline of worker’s incomes. It’s a factor that nobody
Hank Blaustein | © 2016 Grant’s Interest Rate Observer. Used by permission. www.GrantsPub.com
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