arbman:
do you think the public would rather have a depression, lose even more jobs, have even more foreclosures? our sovereign debt is much lower, %GDP, than it was after ww2 when we had all of europe to rebuild.
this is a piece of cake, especially considering the Innovation Wave in progress. i respectfully suggest you read some of the futurists, such as the tofflers, who put in perspective that the computer and software revolution is just a facilitator for the next wave of human development.
Of course, this is not the end of the civilization, we are only trading here. Why don't we stop fantasizing and actually put together some numbers about how much of a capital and development would be needed for a new bull market and whether it would be still feasible in terms of additional national debt with the potentially soaring commodity prices?
Just sit down and do this, come back with the wide ranges. All I see here is the debt + stimulus cannot be easily financed at the current trend of the Treasury yields. I thought earlier that it could've been, but that glimmer of hope is slowly fading at this point. We are simply headed for an inflationary blow off and then more deflation in my view...
The past is a very good guide for the future and I don't believe we will be doing exponentially better over the next 3-5 years since this economy is still tying to carry forward the excesses and mistakes of the last secular bull market, of course we cannot destroy everything, but the bad debt will be still weighting on the economy and that it may just break it one more time, if the inflationary pressure increases...
It is all about inflation from here, or availability of cheap money. Keep your eyes on the long term rates.