Professor Mark J. Perry's Blog for Economics and Finance
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There is a lesson in this excellent table. Buy on the scare.The world produces excess capital. Huge piles of money need to be invested. Any bust or downturn is a buying opp.A 20-year global boom ahead, led by Far East. The USA will participate but lag, due to our chronic federal deficits. Invest in Asia, move to Asia if you can. More money will be made in the Far East in the next 20 years than was made in the history of the USA.
...versus the returns for First World countries?Those numbers I'd like to see.The recovery only begins when The First World recovers; it does not begin when the Third World decides to usurp.
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Then again, that data would be a bit harder to get unless you could get a "North America + EU(Developed, excluding expansion countries) + Non EU Developed Countries(such as Switzerland) Europe region + Israel + Australia / New Zealand" index (or composite thereof).That's what I'd consider a First World Index for this century.
Stocks higher? Famed investor says don't bet on itDecember 27, 2009As CEO at Newport Beach, Calif.-based Pimco, El-Erian, 51, oversees nearly $1 trillion in assets, more than the gross domestic product of most countries. So when he talks, people listen.What he's saying now:--Stocks will drop 10 percent in the space of three or four weeks, bringing the Standard & Poor's 500 index below 1,000 -- though he's not predicting when.--The unemployment rate will be hovering above 8 percent a year from now.--U.S. gross domestic product will grow at an average 2 percent or so for years to come -- a third slower than we're used to.El-Erian says many of the bulls don't appreciate just how much the government props still under the economy are masking its weakness.
I wonder if Obama would claim his stimulus package caused these global turnarounds. Yeah, I bet he would.
Asset prices are inflated because the nominal interest rate is zero and the real interest rate is negative. Artificially low interest rates are a one way ticket to prosperity. Worked so well in 2001, can't imagine the same formula will lead to anything but good times ahead. led Let's all celebrate.Come on!
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Dr. Mark J. Perry is a professor of economics and finance in the School of Management at the Flint campus of the University of Michigan.
Perry holds two graduate degrees in economics (M.A. and Ph.D.) from George Mason University near Washington, D.C. In addition, he holds an MBA degree in finance from the Curtis L. Carlson School of Management at the University of Minnesota. In addition to a faculty appointment at the University of Michigan-Flint, Perry is also a visiting scholar at The American Enterprise Institute in Washington, D.C.
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