Tuesday, February 24, 2009

No Free Lunch

Identification of the source of Terrorism should be the goal of Economists; it is a pity so little has actually been accomplished in the field. Almost all Terrorists, including American students who create Shooting incidents in School, seem to be of above-average intelligence, have had a great deal of economic resource devoted to their education, and present Indicators of some degree of failure in their personal or economic life. They tend to express little aptitude to adjust to their environment, and face considerable family pressure to succeed. They adopt personal lifestyles and behavior which allow them to claim superiority to their Peers, no matter how ludicrous may be this assertion. The entire adjustment simply allows Escape into fantasy, and reduces their involvement in Terrorism to a movie role where they get to play an assumed ‘Hero’ part. Economists need to be able to identify such personalities, and close the portal into destructive behavior; a process which the Israeli Prime Minister does not understand, as he desires to punish the most sustaining elements of society, such families exhibiting a high degree of success and performance.

Here is a Piece which should be read, for it gives an accurate portrayal of the economic development of the financial crisis. It does nothing, though, for the generation of economic policy. The observances are general in nature, and present no directional context. There is no prognosis of likely Outcomes, nor even proposals to alter or amend the current status of developmental trends. Every Reader needs to understand what the article tells Us, and I suppose We should be grateful for the basic outline of economic development, but We all could wish for directional avenues. The primary note must be the Reserve cushions created under the Chinese system will be valueless to emerging economies, unless and until they can keep their own labor forces employed; interior economies cannot be left to collapse, whether it is an emerging or developed economy. This financial crisis is creating a disconnect between Developed and Emerging nations, one that neither style of economy can withstand.

China shows the destruction of the financial crisis, as Mike Shedlock points out. He states there is a 14-year supply of Commercial Property in China. Huge construction was conducted under the impact of cheap Cash with devotion to commercial property, all because of the high Profits involved in the construction. There real need was for Housing, then and now, and the buildings stand empty waiting for non-existent commercial Renters, while Housing is too expensive for Chinese labor; Americans are easily familiar with spending half their Income on Housing; almost impossible when your Income is less than One-Seventh of Americans (renovated Houses probably average more than $60k, while American-quality Housing starts at a probable $200k in China). The Post speaks or a return to rural areas by labor, because it is too expensive to be unemployed in the major cities. China and other emerging markets cannot help themselves, and can provide no aid to the developed economies. We must solve our problems ourselves! lgl

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