Yes, Central Planners Are Trapped But Here Is The Real Worry
KingWorldNews.com
Oct. 21, 2015
With global stock markets mixed, today a legend in the business sent King World News a powerful piece about why the central planners are trapped.
October 21 (King World News) – From Art Cashin’s note: “An Empty Toolbox – In their latest Hoisington Quarterly Review, Van Hoisington and Lacy Hunt present a rather sobering view of the Fed’s current quandary and a struggling economic recovery. Given their very accurate calls on bonds and interest rates, their views must be taken very seriously. Here are a few snippets:
Future business activity will reflect two economic realities: 1) the over-indebted state of the U.S. economy and the world; and 2) the inability of the Federal Reserve to initiate policies to promote growth in this environment.
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U.S. government debt now stands at 103% of GDP. If private debt is included, the ratio climbs to about 370% of GDP. Scholarly studies indicate that real per capita GDP growth should slow by about one-quarter to one-third from the long-run trend when the total debt-to-GDP ratio rises into the range between 250% and 275%. Since surpassing this level in the late 1990s, real per capita GDP has grown just 1% per annum, much less than the 1.9% pace from 1790 to 1999.
The Rest…HERE
