Why the Jiffy Pop Economy Will Win...EventuallyAugust 28, 2013 Posted by: Joe Morgan, CFA
The views expressed in this column are solely those of the author and do not reflect the views of SVB Financial Group, or Silicon Valley Bank, or any of its affiliates
For the past five years, it has been easy to play the "woe is us" card. The challenges our economy has faced have been nothing short of severe. But, like most winners in life, our challenges were self-induced, meaning we have the power and control to overcome them as well. There is no reason to think the U.S. will become a second-rate power, economically speaking.
As I sat down to pen this article intended to share a positive medium-term outlook, I came across a Bloomberg editorial that largely did it for me. Gary Shilling, a well-respected economist with success in both the private and public sector including a stint at the Fed, does an excellent job sharing our country's underlying strengths as a society and an economy.
So, instead of crowding the blogosphere with a repeat post, I will summarize his points of strength and add my perspective. Any twisting of Dr. Shilling's views is entirely unintentional.
Demographics. We have always been a country of immigrants. And once immigrants settle to become "Americans," we've always felt challenged at the notion of letting others
in. But, we've always done so. In fact, the open-nature of our borders and the openness we show to new immigrants drives the creative destruction necessary for our continued economic dominance. Solutions will be found on the current immigration front.More Workers. There are 2.8 million fewer workers today than in 2008. Labor force slack is an untapped strength that will allow us to compete, however we need to encourage workers to think for themselves, creating new positions, services, and ideas to monetize in order to thrive in a world of falling barriers. It does not make sense to compete on a manual labor level. We must compete on a cerebral level.Entrepreneurial Spirit. How can a nation of immigrants desiring freedom and success not have a strong entrepreneurial spirit? Government's role must be to promote this spirit toward a rewarding success. We must be careful...Read More