"I was quick to grab onto the Balance Sheet Recession. I sent Eoin all kind of material from Koo etc. That's why I was bullish on bonds. And I'm not particularly bearish today.
"Koo's thesis could have been avoided in the US. The bubble was not quite as bad in pricing, but is / was worse in quantity of overbuilding and the percentage of people who bought homes they can't afford. Summers, Geitner etc, were heard to say on numerous occasions that they had "The Japanese Playbook" and would not make the same mistakes. They flooded the US/World with liquidity trying to stave off deflationary pressure (Helicopter Ben?).
"This may have worked, and may still work. I said to you in an email over a year ago that the only person that could kill Fed and Treasuries efforts would be Obama. My clients are predominantly business owners. Without exception, they feel under attack. Businesses that feel under attack and uncertain do not invest and do not hire. I know of companies that have put off expansion projects until they know the outcome of the next Presidential race. And these are not even remotely all Republicans. Friends aren't spending and have no intent of spending, that's not a formula for growth. I don't think that it's partisan at all to say the bond yields will not rise and the economy will not recover until businessmen know Obama is gone."
David Fuller's view Thanks for your forthright views.
Clearly, many business owners and CEOs do feel under attack. And for this the many good ones can thank Enron, investment banks, Wall Street and other exploitatively managed companies for their excesses which reached the point of an open invitation for redistributive and regulatory policies.
I maintain that most US business have improved their governance in the last few years. The multinational Autonomies are also investing where they see growth, which has been mainly outside the USA recently. To entice more domestic investment, Congress will have to move beyond today's toxic political climate and find some commonsense, bipartisan solutions appropriate for the US economy.