Practical Ways To Fix The US Economy??

From Ritholtz's Big Picture blog:

What If the US Trade Balance Became a Surplus?

We can all see that shale oil is a growing business. US oil production is rising, even as consumption is dropping due to more efficient use of oil. You can easily find projections that within 10 years the US could be energy-independent. And if we get some policies that allow more wells to be drilled (which could create another 1 million jobs) it could happen even sooner!

That will narrow the trade deficit but not eliminate it. But…

What if we find a way to take our huge natural gas supply and send it abroad? Natural gas is about $2 today. There are supposedly 10,000 wells that have been capped and very few new wells are being drilled. Natural gas is just too cheap in the US. But it was recently $17 in Japan, and almost that in Europe. Even I can see an arbitrage there. There is certainly enough global demand to allow the US to sell enough natural gas to further reduce or even eliminate the trade deficit (again, depending on the national policies we set).

That is the lion we can see. But what happens if we stop sending our “surplus” dollars into the world? A growing world will need more dollars to finance global trade. And to buy our exports. The lion that is hidden is that the dollar would become seriously strong. Today, everyone and his uncle is predicting the demise of the dollar (along with other fiat currencies). But what if we actually got our deficit act together and combined that with a real energy policy? That sounds rather Pollyannaish today, but it is totally within the realm of possibility.

A strong dollar has all sorts of positive effects if it is accompanied by a trade surplus and a balanced budget. Can you imagine a world where the dollar is the reserve currency because it deserves to be, rather than by default because no other currency can step up to the plate?
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What then?
 


It's going to take 2015 to build up the west coast port infrastructure to ship large quantities of LNG to Asia.

Maybe a little bit sooner to get pipelines built to get the shale oil to the ports for export.

But yes, 3-5 years out the U.S. will get to trade surplus and stay there because of the shale boom. All the guys in oil and gas know this. Even Obama knows this but he has to play dumb because of the greenies.

And even at present, the US is deleveraging with household debt coming down.

The future is brighter than you think, if you're American.

Now, if you are European, ah, it's a bit more cloudy... smart money says Spain is going to blow up before Christmas (and I'm not happy about this, the junior markets will get hammered again)
 
Make everyone who is unemployed for more then 3-4 months to join the military or do a training course to fill skills gaps in the economy OR receive 0 benefits.
 
IMSHERIFF said:
Make everyone who is unemployed for more then 3-4 months to join the military or do a training course to fill skills gaps in the economy OR receive 0 benefits.
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While I do not exactly agree with the above it does remind me of something I heard today where the Govt is putting together a program to teach unemployed veterans construction - what dumb idea. There are tens of thousands, if not more, of unemployed construction workers - why not give them skills in demand. Construction? What a joke. Training them in a career that has had a dropping wage level for decades - why not teach them to pick fruit or work as immigrant farmworkers...
 
How to fix the economy?

#1 redesign the education system with the help of private enterprise so we know what education is needed by private business and we can funnel students into those occupations.. Oversupply will still exist but system should be able to react to these changes and shift any sort of grants, government funding to the fields that are needed to make it cheaper to take courses for something that's needed while more expensive for something that's not.

#2 Heavily fund research and development - The jobs of yesterday are gone and we all agree they aren't coming back. So let's create new materials, products, systems and things we haven't thought of yet too make new jobs. The internet created a couple of jobs last I checked.

#3 Simplify taxes - I'm not smart enough to say how this should be done, but every little tax break or incentive thats been added over the years needs to go. Here in Ontario we have the Childrens activity tax credit that reimburses me up to $50 towards sports etc.. This does absolutely nothing for me, but all those little $50 incentives add up to millions of dollars and for what?

They wouldn't solve EVERYTHING but it would be a start.
 
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