With the continued stream of data coming out of the U.S looking less than impressive, and the constant reminders of China’s impending slow down – there comes a point where one truly needs to step back and take a good hard look at the reality of our current situation.
We’ve discussed “normalcy bias” here before as well the effectiveness of “money printing” and Central Bank interventions….as well we’ve been over hundreds of charts / values / levels etc navigating the day-to-day “ebb and flow” of currencies around this planet.
But what about the larger view? I mean – THE LARGER VIEW.
We know that the money printing can’t last forever. We know that the largest consumer economy on Earth (the U.S) is essentially flat to worse – after massive devaluations of its currency. We know that China is slowing down. We know that Europe is in no better shape than it was several years ago – and likely in worse shape behind the scenes.
We see / read that nearly every panel / comittee / board / analysis / is projecting for Global GDP to fall – not rise.
Short of advances in space exploration and biotech – what do you see as potentially the “next driver” in global growth?
Not some “housing number”..not some “fed announcement or recovery bullshit” – I’m talking about something that will actually SPUR GROWTH ( as did the Internet for example….the Industrial Revolution etc…) ?
If nothing immediately comes to mind then I suggest taking another moment to consider – how long do you seriously think this “Ponzi scheme” can continue short of something REAL happening to kick-start another phase of growth on this planet?
What’s it gonna be?
Whats on the cooker Kong? Im long AUDCAD as of this afternoon. I’ve been wondering. Why is there not an instrument to trade diamonds/gem? De Beers like to keep the market illiquid? Ah…i think i have it. Each gem is different and valued accordingly. Impossible to have an instrument with a blanket valuation.
Totally.
Gems……freakin brillant in concept.
Long AUD/CAD – wow……u do pick some wild one’s as ( ya the level / technicals look good as bottom of big/long term range) I can’t wrap my head around trading one commod related currency “against” another – on a fundamental basis. Both AUD and CAD will rise or fall ( for the most part ) during times of risk on vs risk off “against” a safe haven such as JPY or USD so…..trading one against the other – technicals/ chart -looks like a beaut here. Fundies? – no idea.
Google this: ‘Have you ever tried to sell a diamond’. Good bed time reading from The Atlantic about how a market was made for diamonds and how through an mutli decade long marketing campaign they they created the perception of value.
Thanks man….will have a peak tonight.
Kong,
Good article as usual. I couldn’t agree more and a lack of global innovation is what will condemn a lot of the planet to long term unemployment as we slowly automate most of the menial and even some professional work (e.g. medical self diagnosis will spell the end of much doctoring).
That said I have a few ideas where innovation breakthroughs and even old technologies could spur new industry growth:
– Battery technology (as soon as someone develops that quantum leap battery that lasts super long there goes mucho electricity and could spur a new technology race in new devices)
– Solar & Wind Power (miniaturise these and there goes more electricity as your neighbour could sell you power)
– Nanotechnology – see biotech.
– Food technology (grow your own vegies and fish could be the next big thing as neighbourhoods feed themselves and sell their excess)
Some of these are back to the future but may generate net new jobs. If only we were spending enough on them NOW, sigh.
Sadly, the bottom line is that we are currently doing a good job of innovating at a lower rate than the population is growing, and spending less on new techs than we should, so a growth crunch is coming. Never underestimate our ability as a species to focus short term with carp like QE to mask much bigger problems at the expense of the long term (see global warming).
Cheers.
Fantastic Deano. I am with you 100% across the board here.
– Extended battery life “will” make for some big innovation no doubt.
– Nano is really coming along with tiny robots now able to think/move/adapt as a group….as well possible “self replication” in teaching them to “build” themselves. Love it.
– Alternative energy ( I also like “tidal” as well geo thermal ) still under funded in my view….and “should” be much further along. be as
– “Localized” food production “will” come to be an absolute necessity. (Like a veggie garden on the rooftop of your high rise type thing)
Sadly, you’ve got it…..lots of short term thinking.
Yuro is ripping kong i think actually europe is gonna do ok with all those doompeople about europe.
I think the austerity eventually is gonna work people need to get used to it the whole wellfare ponzi scheme the new growth is gonna be when people actually are really gonna work instead of benefitting from the system getting obsetitas and full in debt.
I think the new growth is gonna be the people who wanna do something instead og the lazy 1s. There might be a bigger gap but thats the truth somepeople are just lazy.
Enough of my crazy thinking nice article kong 🙂
More crazy thinking please – this is what we need.
Euro “current strength” looks more like bi – product of USD weakness to me here – as EU is equally hooped. He he he…..damn currencies – one up / other down etc – and a”daily explination” for each…impossible.
Broad strokes….short fiat currencies…long inter planetary travel.
This should keep me relevant for some time.
I’m not confident in the current economic paradigm’s ability to generate any real growth, only growth in money supply and the misapplication of capital that comes with it. That said I see huge potential in computer science and internet technology. A top notch programmer can decide his salary and company, or just do projects independently. Technology is rapidly reducing the need for human labor, except for software developers and engineers who still need to design the technology. There is such a demand for programmers right now that you don’t need a degree or even much experience for someone to give you a shot. If you can program, you can work. This demand will certainly draw more people into the field, and maybe someone will digitally synthesize the next big thing. More likely rather than helping everyone it will increase the economic stratification between the smart and not as smart.
Great input Grazy.
I know alot of this kind of work is currently headed for India, where programmers are highly skilled and willing to work for next to nothing.
No question that there’s considerable demand.