Mr. Softie


Author Larry Berman

Posted: 3 May 2012 re-posted from etfcm

Mr. Softie! Not the ice cream, the global economy. The ISM numbers are weakening everywhere and job growth is slowing back below the rate of population growth. The Bernanke is being lectured by many smart people that his policies are ineffective, but what choice do they have? A hard cleansing, lots of bankruptcies, write offs, and restructuring. Who is going to vote for that I ask? A few of the 99% for sure (none of the 1%), the growing support for Ron Paul suggests as much.

But modern revolution takes a long time (decades), though it looks like the hot spots in Europe, Spain in particular with 50% unemployment in the under 25 cohort, are on the verge. The ECB will not likely be able to contain this one for the simple fact that Italy is right behind the most vulnerable countries. There is too much debt in the world, the jig is up, and the piper needs to be paid. Get used to the market uncertainty and volatility.

Corporate America will likely be fine, lean and mean and able to deliver earnings, though we have likely hit a cyclical peak in margin expansion and earnings growth for the next few years is probably non-existent.

 

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