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Monday, November 23, 2009
"Man Bites Dog" Front Page Story in New York Times...FINALLY!!
An EXCELLENT front page article in todays New York Times on the National Debt and the potential financial ticking time bomb it is. If you have taken AP Macroeconomics or are taking it now, the MOST of the discussion will be familar to you. This issue is not, in my opinion, taken seriously enough by the public. Both political parties are party to this problem so there is enough blame to go around. We will not be able to grow our way out of the debt, at least not in the next 5 to 10 years. I believe we will have tepid economic growth because we have reached the end of your last significant Aggregate Supply shock (1990's to early 2000's). This is the last time we had a increase in our productive capacity due to the leaps in technology, communication, transportation, fiber optic cable,, etc that vastly increased our productivity. We seem to have milked that for all it is worth. We will have marginal increases in productive capacity but not enough to sustain the increase in population and the need to create 150,000 plus jobs a month to keep up with new entrants into the job market. WHERE IS THAT NEW POSITIVE AGGREGATE SUPPLY SHOCK GOING TO COME FROM? Opinions???
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