Another brilliant series of raw cuts, this time featuring legendary investor Jim Rogers, from the upcoming film The Bubble. Of the hundreds of interviews I’ve seen with Mr. Rogers, this is possibly the best. Why? Probably due to the fact that the film’s writer, Thomas Woods, is an Austrian/free-market economist like Rogers.
“American finance is going to be in a (relative) decline for the next 2 or 3 decades… 10 years ago, most IPOs were done in NY…”
“It will be good for us all when this central bank eventually disappears…”
From the upcoming documentary The Bubble by Tom Woods.
I can’t wait for this movie. All the footage I’ve seen so far looks fantastic.
Partisan bickering over roughly a trillion dollars in tax revenue (over the next ten years) is a farce, laughable. It means nothing. Chris Cox and David Archer did a nice job summing up the math in this WSJ piece:
When the accrued expenses of the government’s entitlement programs are counted, it becomes clear that to collect enough tax revenue just to avoid going deeper into debt would require over $8 trillion in tax collections annually. That is the total of the average annual accrued liabilities of just the two largest entitlement programs, plus the annual cash deficit.
Nothing like that $8 trillion amount is available for the IRS to target. According to the most recent tax data, all individuals filing tax returns in America and earning more than $66,193 per year have a total adjusted gross income of $5.1 trillion. In 2006, when corporate taxable income peaked before the recession, all corporations in the U.S. had total income for tax purposes of $1.6 trillion. That comes to $6.7 trillion available to tax from these individuals and corporations under existing tax laws.
The money isn’t there. 100% tax rates would leave a deficit. There’s an $86 trillion hole in America’s balance sheet, and I strongly suspect almost all of it will be monetized by the Fed. This is what some would call the hyper-stagflation scenario. QEfinity on steroids. Inflation north of the 20%/y we saw in the 70’s, for an extended period (10 years?) would not surprise me.
Key talking points:
- Borrowing for consumption purposes is counterproductive, borrowing for infrastructure can be a good thing.
- Within 5-10 years the [Western] “system breaks”.
- Asian crisis was unlike next Western one will be, due to “new Keynesian” response.
- Most Fed members make Bernanke “look like a hawk”.
More at Marc Faber’s site, www.gloomboomdoom.com.