Friday, August 12, 2011

Is this the reason for our current economic troubles?

The three major ingredients in building and sustaining an economy are: energy, financing, and a supportive political system. Since 2000, oil prices have soared, ending the age of cheap oil that our economy was built upon. In exactly that same time-frame, the explosion of the shadow banking system has diverted money from the real economy and into the financial economy, while much better growth potential in foreign economies has sucked away any remaining financial capital. Despite what many politicians and ignorant political wannabes say, the US political climate from a business point-of-view has changed little in the past decade, remaining largely pro-business, but with a little extra room for financial interests. So, in conclusion, the energy and finance parts of the equation have deteriorated dramatically in the past 10 years, while the political factor has, at worst, only weakened slightly, but since the first two outweigh the last, the economy has lagged badly in the 2000s. Am I correct?

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