I've been asked by many people to share my thoughts on our economic future. (Well, several people anyway. OK, a few people. Alright, nobody really asked me.) So I've set aside my busy schedule of computer solitaire and vacantly staring into space to write this overview, so the very least you can do is sit up and pay attention and wipe that silly smirk off your face.
The first thing you have to understand when it comes to the national situation, is the international one. The continuing crises in far away Flirtonia and the Persnickety Islands (not to mention Whereamanation, where the currency is throat-lozenges) mean that the value of the US dollar will continue to rise. Unfortunately the values of the US quarter, dime, and nickel will continue to shrink.
This will result in confusion.
Milton Friedman says let U stand for the tastes and preferences of the consumer. I say, yeah, go ahead and let it.
Meanwhile, the all-important housing situation will remain, as we economists say, higgledy piggledy. Anything can happen. One moment your house will have three bedrooms and two baths, the next it will have two bedrooms and one bath, and then suddenly it will have forty-four baths and no bedrooms at all. This will make it more difficult than ever to remember where your clean pants are. I suggest leaving all your clothes in the middle of the floor until the situation has a chance to clarify. So much for the higgledy end of the housing situation. When it comes to the piggledy end, the less you know, the better, trust me.
To stem this, it's vital that banks be encouraged to lend as much money as possible to as many people as possible. Simultaneously, however, the banks must be regulated to lend as little money as possible to as few people as possible. This will also lead to confusion. See my comment in paragraph 3.
Everyone agrees Congress needs to act. As far as I'm concerned, they can act, sing, dance, walk tight-ropes, or whatever, so long as they don't attempt to legislate. Whatever the outcome of the current deadlock, it's a pretty sure bet the ultimate decision will be indecisive. (Comment at end of paragraph 3)
Then there's the stock market, and I'm tempted to go ahead and refer you to the end of paragraph 3 and be done with it. J P Morgan once famously said, "The stock market will fluctuate." This may no longer hold true.
The unemployment picture remains pretty grim no matter how you look at it. Look at it with one eye half-closed and your head tilted to the right. Now stick out your tongue and pull the corners of your eyes squinty with your index fingers. Touch your nose with your thumb and look at it cross-eyed. See what I mean? (Paragraph 3).
So in sum, I recommend the individual investor buy land. Not property, just land. I have several large containers of fill-dirt strategically stored around my house waiting for them to appreciate. Also, buy as much stock in the British East India Company as you can lay hands on. Currently the stock is worthless so it seems unlikely to depreciate in value much further.
And there you have it.
(Originally posted 2012)