Marc Faber is described in Wikipedia as “a contrarian investment analyst and entrepreneur” who said in 2008:
If we spend that money at Wal-Mart, the money goes to China. If we spend it on gasoline it goes to the Arabs. If we buy a computer it will go to India. If we purchase fruit and vegetables it will go to Mexico, Honduras and Guatemala. If we purchase a good car it will go to Germany. If we purchase useless crap it will go to Taiwan and none of it will help the American economy. The only way to keep that money here at home is to spend it on prostitutes and beer, since these are the only products still produced in US. I’ve been doing my part.
Watch parts 2 & 3 of this interview.
And for those working stiffs who think you’re smarter than your boss who makes too much money, read this.
To that analyst: Welcome to where I was 5 years ago 😉
I’ve been pointing out the fact we have no domestic goods production and a huge $600 billion export deficit/yr for quite a while.
Well, at least someone out there is thinking!
A country can’t just import, import, import and only have domestic jobs that are selling services to one another. That’s a huge drain on the economy. We have to export and produce more domestically or we are doomed because we will have no chance of even making the government debt payments.
Its very true debt is what drove the economy for a long time and its eventually collapse. Obama is wrong to say the government had nothing to do with this. They wanted easy credit which allowed our economy to grow. But its almost a artificial growth because its not sustainable as we now know. Having government artificially stimulate a economy with jobs from borrowed money is no better and government just keeps growing. This only amounts to more tax revenue or we go further into debt. Right now our choice is further into debt. Obama has too many pet projects like Health care that simply will cost taxpayer’s in lower disposable income. This will in effect slow any possible economic growth.
We are heading for third world status. Any country that doesn’t understand that it’s prosperity depends on its business and farm sectors being healthy and prosperous is doomed.
Okay you might be able to run a small country off banking, making foreign loans, and the tourist trade at least for a while but we are a large nation and we are counting on the Tooth Fairy and Santa to bail us out.
It isn’t going to happen.
And that is before you add in the ponzi scheme health care bill or the Energy tax bill.
Anyone with a brain that can do 5th grade math old style with an IQ of maybe 90 can figure this one out. All you have to do is be able to add, subtract, multiply, and divide and you don’t even have to be very good at the last two. You can use an ultra cheap calculator if you want to.
Still the concept that that there is a limit to the nations credit does seem to be beyond the grasp of many Americans especially those in Congress.
I’d say once the health care bill is passed we have five years tops before our economy is plugging for the sea floor like the Titanic and when we hit we may not even come out the other side as one nation or a republic. Dictatorships are commonly forged out of such events.
Hmeyers… yup, and poor ol’ Walmart gets all the flack. You’d be hard pressed to find any retailer, manufacturer or wholesaler that doesn’t buy from Asian countries.
If we had let the banks fail, the economy would have reset, and we’d be on the road to global rehabilitation.
But no one on DU is really prepared for a change in their standard of living.
I guess the Harvard B-school plan of having America’s new industry of making and selling securities isn’t working out so well.
Looks like debt really ISN’T a product.
Who could have guessed? I mean, it looked really good in Powerpoint.
Good thing we don’t have a naive academic ideologue with zero real-world experience in the White House.
Oh wait…
If Obama has his way and cap and trade is enacted, I doubt much of anything will be made here anymore.
This interview is funny and all, but inaccurate. US exports is up about 50 percent (pdf) from 2005.
Well, some of it’s right… except you buy gas and the money goes to CANADA! Thank you for your support.
This guy is looking at this from an investing viewpoint. From a “going concern” viewpoint we’ll manage.
Interestingly, I’ve noticed that my purchases of other than total commodity things are more and more USA Made. Or Canadian, which is like States 51-60 (joke). And of commodity items, the absolute staples like bread, meat, and grains are USA Made. I live in the midwest, so that might have a bearing. I’m not buying computers/ TV’s/ electronics every day. I am buying grains/ meats, fruits, lumber, tools, and other items regularly. Lots of ipod touch software, and books.
When it comes right down to it, how many TV’s/computers/blu-rays/etc… do we REALLY need? We could give up many of the “luxury” imported items without destroying our economy.
BTW, USA GDP=$14.5T (2008), USA Imports=$2.5T (2008). USA Manufacturing= $1.8T (2007). We are still (barely) the #1 manufacturer in the world. We just don’t employ many people doing it. It’s not quite as dire as predicted. 25% of all oil used in the USA is domestic. And while many are lamenting that we “have to” import food- we don’t. In the basics of life, like grain, we are huge surplus exporters. It is our debt wealth that allows us to import a lot of expensive foodstuffs such as seafood, coffee, and wine.
So, we’re not going to starve, we still make things, and we have enough oil that we could muddle through in a pinch.
most of the anal-ists, have been running around like the hotel soap character from Dr. Tran, shouting “EVERYTHING IS F**KING WONDERFUL!!!!”
(google dr tran to find out what im talking about here! it will brighten your day)
after this little fiasco is over the next looming crisis is the “needing education fantasy” you can see this played out right now with the H1B imports to “fill the low number of (pick your tech job of choice) positions that need to be filled. has nothing to with with there not being enough people here in the country with the education requirements. it isnt that, it is just they dont want to pay american workers what they are worth, they want to import labor cheap..
this will be coming to all job markets soon..\
happy holidays!!!!
His main point is that the US should make more stuff. That’s entirely true.
A coming complete collapse is iffy for a few reasons. Europe and Japan are in worse shape than we are, debt-wise and demographically. The middle east is filled with oil but little other economic activity. China could easily implode, and Africa is Africa. If things get really bad here they are likely to be worse everywhere else.
#12 – China will not implode. The ordinary people ar better off than have ever been in their long history. The grandmothers parents of their young people were crippled by having their feet bound. Neither will India collapse for similar reasons.
We should stop worrying about a “total collapse” and other vague concepts, and start manufacturing stuff here, for ourselves and for exports.
It’s about jobs! Everything flows from that. If you lose your job and can’t find another, it becomes very clear.
#13 The leaders of China don’t dismiss the possibility of instability, and here’s why:
Historically China has seen a bunch of rebellions, both major and minor. Some governments, like China and France, really are frightened of the populace.
The most likely vector for internal strife would be smaller separatist movements from Western China spreading into the manufacturing centers.
Economic growth has allowed the government of China to keep a near monopoly on political action. If that growth should falter, due to lack of demand for products or lack of materials inputs, the political vacuum could break in a messy way.
Saying a large group people shares a common view is a dangerous assumption. Chances are that many non-Han Chinese don’t even consider themselves Chinese. Han Chinese are to China as Russians are to the USSR.
As to India, I think there is a much smaller chance of serious internal problems. In case of a real military engagement with Pakistan that chance would obviously go up dramatically.
Hi,
There are so many views and analysis about American economy. I think it’s tally depend on America. If America want to rise his country economy then it must be change war polices.
Thanks for your time.