“There’s no way out, they need to stimulate through it,” said the CIO. In 1965 the government spent 3.25% of GDP on research and development, today its 1.25%. That missing 2% of America’s $18trln economy equals $360bln of annual R&D investment. Gone baby gone. In 2000, NYC spent 8% of its budget on healthcare and pensions, today that’s 29% and rising. “Taking these factors into account, developed economies have t
Hope all goes well… “The Fed faces the choice between allowing a US bubble to form and blowing up the world,” said the CIO. “And they’re trying to have it both ways.” No one likes facing a dilemma, particularly PhD’s. They’re too smart. “US banks have deleveraged, corporates too. Households deleveraged and the government took on that debt.” America is inoculated from deflation relative to the rest of the world; we’re