~~PING!
“The U.S. deficit — just the gap between spending and income in one year — is projected to hit $1.6 trillion in 2010. Total debt is project to exceed 100 percent of GDP starting in 2011.
In the parable, Munger strongly suggests that the United States take seriously the campaign of Reagan-era Fed Chairman Paul Volcker, who wants the big banks to cease pretending to be banks if they expect the freedom to trade securities on the side.
“He suggested that Basicland should strongly discourage casino gambling, partly through a complete ban on the trading in financial derivatives, and it should encourage former casino employees — and former casino patrons — to produce and sell items that foreigners were willing to buy,” Munger writes.
As the parable ends, none of the politicians listen, and Basicland turned into “Sorrowland,” Munger concludes.”
Munger and Volcker are mostly correct there. But skimming Mungers essay I saw nothing about the ever growing public sector that is squeezing out the private sector. Maybe I missed it.
Volcker and Munger are old school both must be 80 or so. They lived in depressions wars and the post 1950 boom. They know the America that was a producer economy not a hybrid consumer/casino economy
Oh STARWISE, where to start.
We have government employee unions and their pensions being supported by taxpayers paid half the government workers’ salaries. I can hardly wait for the goverment workers in NJ that Governor Christie is going to cut to scream that the state will lose them as taxpayers!
Millions of jobs are not coming back. Ever. We produce virtually nothing that can’t be produced cheaper elsewhere, largely because of union wages. I’m not good at putting my thoughts into words on this subject.