Last week we looked at structural issues. Specifically, the oversupply glut of 3 billion workers competing for the work that 800 million workers were doing before the Internet opened the world to the emerging market supply chain. Think China’s massive infrastructure build out – the excess manufacturing and labor capabilities and also think about Korea, Singapore, Taiwan and India. Fifteen dollar per hour wages are not going to fly when there are people doing the same thing for $15 per day.
The big consumers are the developed countries and some of the biggest consumers (well, you and me) are here in the U.S. But older we get and the demographic winds require more savings and less spending. We already bought a lot of the stuff.
Last week I promised you a “Cliffs Notes” version of Lacy Hunt’s latest letter as well as some thoughts from Gary Shilling. They are two of my favorite analysts. So let’s jump on in and make this week’s letter a quick and to the point read.
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