Last night it hit home for me…we were at a friends house, and he started going through a basket of toys from his son..
1. Made in China
2. Made in China
3. Made in China
.
11. Made in China
12. Made in Mexico (a musical shaker from tijuana:)
13. Made in China.
.
.
20. Made in China
Those toys (Current Deficit) were effectively the financing that propped up the U.S. housing market, that created the private equity boom, and that finance the crazy credit card spending habits of American Consumers(capital surplus), .
What are we offering them? One thing: An IOU on Our Future and the future of our kids. I’m by no means anti free trade, but I am reminded of some of the writings of Adam Smith-sensibility is critical to the success of capitalism.
Creative destruction does exist and should exist. My hope is that the current meltdown continues just long enough to bring some sanity back to this country, but not so long that it leads to its demise.
