A brief summary of everything that's been fixed.
Much to the amazement of doom-and-gloomers, everything's been fixed and as a result, everything's great. The list is impressive: China: fixed. Japan: fixed. Europe: fixed. U.S. healthcare: fixed. Africa: fixed. Mideast: well, not fixed, but no worse than a month ago, and that qualifies as fixed.
Let's scroll through a brief summary of everything that's been fixed.
1. China's economy. It was slowing down, which would have been bad for the global economy. But the recent PMI (preliminary made-up indicator) readings have been the strongest since the Great Leap Forward.
The basic story here is China needs a million more of everything: a million more concrete highrises, a million more airports, a million more miles of highway, and so on. And because there are 200 million rural peasants anxious to open nail shops in all those empty ghost cities, there is no end to growth in China.
And thanks to central banking and a wide-open spigot of credit, there's also a million times more leverage and debt in China. It's a perpetual growth machine.
There are growth stories on top of growth stories in China. There are 300 million diabetics and pre-diabetics in China right now--the equivalent of the U.S. population. Think of all the growth possibilities for diabetes clinics in those ghost cities. All the owners of those nail shops and diabetes clinics will be getting so rich, Goldman Sachs will be needed to sell them safe investments like Detroit Muni Bonds.
2. Japan'a Abenomics has worked, and Japan is back. Need proof? Just look at the Japanese stock market: it's up. What more do you need? Hello Kitty is expanding its market share of the global Cute market--yee-hah!--and the 2020 Olympics will be a growth story for seven years--a Biblical cornucopia of growth, growth, growth.
3. Europe is on the mend. European stocks are at 5-year highs--proof everything's fixed. Greece's budget is near surplus (if you exclude interest payments on their debt), and there's light at the end of the tunnel on Europe's debt crisis. The fix is LTRO (long-term ripoff operation)--basically another perpetual growth machine funded by free money issued by the European Central Bank. Can't pay your debts? No problem, just borrow more!
It won't take more than a couple trillion euros to set things right and get things moving.
Sure, unemployment in some countries is 25% (or is it 40%? hard to be sure), but that's stabilized, and there are sure to be more jobs for waiters/waitresses as tourism works its growth magic.
4. The U.S. healthcare system is fixed, thanks to ObamaCare. I can't understand the details, of course, but then neither can anybody else, and that's the beauty of it: there's a practically unlimited demand for people who know how all this works. Job growth will be through the roof.
Here's a summary of how ObamaCare works. There's three levels, kind of like a credit card: silver, gold and platinum. Silver is like your current lousy plan, only the government will give you $167 if your plan costs more than $10,000 (or maybe it's $1,670--nobody knows).
The Gold level is much better, similar to gold-plated healthcare plans enjoyed by government workers, but it costs a lot more. Platinum is equivalent to what everyone in other advanced democracies gets from national healthcare, only it costs twice as much here in the U.S.
But hey, you get what you pay for, and that's why the U.S. healthcare system is the best in the world--we spend twice as much per person as anyone else.
If you refuse to get insurance, the government penalizes you $167--or maybe it's $1,670. Nobody really knows yet because there are thousands of pages of fine print to sort out.
5. America has its own perpetual money machine to fuel growth. The Federal Reserve creates money and then buys Treasury bonds. The Federal government sells the bonds and uses the cash (just created by the Fed) to pay for everything: $300 million a piece F-35 fighters, 47 million Food Stamp SNAP vouchers, bridges to nowhere, tax breaks for billionaires, you name it.
And here's the beauty of it: there's no limit to this money machine. The Fed can print a gazillion dollars and buy a gazillion dollars of Treasury bonds so the government can spend a gazillion dollars. There is no consequence of this, it can go on forever. That means we can borrow as much money as we want to buy everything we want, forever.
So you see, everything's fixed, because everybody that can create their own money can do so without limit or consequence. It's a perpetual money machine, and that fuels a perpetual growth machine. No limits on credit and debt means no limit on spending. Free money for everyone and everything--it's unbelievably easy.
Doom and gloomers have been wrong, just like Paul Krugman said. The solution to every problem is at hand: create more money and credit, in ever larger sums, until a tsunami of cash washes away all difficulties.
Please note this is a satire.
Note: blog entries and email will be sporadic for the next few weeks. Your patience and understanding are greatly appreciated.
My new book The Nearly Free University and The Emerging Economy (Kindle eBook) is available at a 20% discount ($7.95, list $9.95) this week. Read the Foreword, first section and the Table of Contents.
The Nearly Free University and The Emerging Economy:
The Revolution in Higher Education
Reconnecting higher education, livelihoods and the economy
With the soaring cost of higher education, has the value a college degree been turned upside down? College tuition and fees are up 1000% since 1980. Half of all recent college graduates are jobless or underemployed, revealing a deep disconnect between higher education and the job market.
It is no surprise everyone is asking: Where is the return on investment? Is the assumption that higher education returns greater prosperity no longer true? And if this is the case, how does this impact you, your children and grandchildren?
We must thoroughly understand the twin revolutions now fundamentally changing our world: The true cost of higher education and an economy that seems to re-shape itself minute to minute.
The Nearly Free University and the Emerging Economy clearly describes the underlying dynamics at work - and, more importantly, lays out a new low-cost model for higher education: how digital technology is enabling a revolution in higher education that dramatically lowers costs while expanding the opportunities for students of all ages.
The Nearly Free University and the Emerging Economy provides clarity and optimism in a period of the greatest change our educational systems and society have seen, and offers everyone the tools needed to prosper in the Emerging Economy.
Read the Foreword, first section and the Table of Contents.
print edition (list $20, now $18)
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Things are falling apart--that is obvious. But why are they falling apart? The reasons are complex and global. Our economy and society have structural problems that cannot be solved by adding debt to debt. We are becoming poorer, not just from financial over-reach, but from fundamental forces that are not easy to identify. We will cover the five core reasons why things are falling apart:
1. Debt and financialization
2. Crony capitalism
3. Diminishing returns
5. Technological, financial and demographic changes in our economy
Complex systems weakened by diminishing returns collapse under their own weight and are replaced by systems that are simpler, faster and affordable. If we cling to the old ways, our system will disintegrate. If we want sustainable prosperity rather than collapse, we must embrace a new model that is Decentralized, Adaptive, Transparent and Accountable (DATA).
We are not powerless. Once we accept responsibility, we become powerful.
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