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The Truth May Hurt…

Posted by Larry Doyle on March 10, 2009 11:19 AM |

I very much appreciate reading material written by people whom I perceive as having no agenda. I have tried to bring people like this (including Ray Dalio, Paul Keating, Bob Rodriguez, Steve Rehm, Kevin Doyle, Vaclav Klaus, and many others) to Sense on Cents because I firmly believe we all become more educated and informed in the process. Please let me know if and when you perceive me, any of the pieces to which I link, or radio guests on NQR’s Sense on Cents as not dealing totally in the truth. Constructive criticism is always appreciated and will make for a better site.

Along with the aformentioned, I have also previously remarked on my high regard for John Mauldin, one of our Economic All-Stars. John himself possesses an insightful global perspective and has a circle of friends and confidantes that are simply off the charts.

In John’s weekly Outside the Box, he shares with us the perceptions of Michael E. Lewitt. Mr. Lewitt writes at length on topics we have covered here previously, but his level of detail and thoughtful analysis are well worth the read.

Topics covered include:
1. economic policies proposed by Obama administration are not promoting long term growth.

2. market outlook . . . sell rallies as earnings and prices are projected lower by 10-25%.

3. R (ecession) vs D (epression) . . . whatever you want to call it, our economy is going to have low growth at best when growth does return . . . time, time, time . . .

4. changing dynamics in the world of investing mandate that people get further up the learning curve . . . . Come to Sense on Cents!!!

5. bank nationalization, in perception or actuality, is a drag on the economy as a whole and specifically for well managed banking institutions

6. holds particular scorn for the “bank robbery” that occurred at Merrill Lynch during the bonus payouts in late 2008.

7. GM is bankrupt in all but name, so now it is time to deal with the truth and go through the bankruptcy process..

8. Obama’s budget utilizes wildly optimistic economic projections and is set up to fail. Government waste MUST be eliminated.

9. the coming meltdown in eastern Europe “will have major negative consequences for world financial markets.”

As I read Lewitt’s piece, Reality Bites, I kept nodding my head and whispering to myself, ‘that’s right,” “yep, I agree,” and “why doesn’t the media cover this?”

This piece may take two sittings to read, but as you look to navigate your own economic landscape it is a must read. Please share it with friends and colleagues as well. Please also share your thoughts, comments, criticisms here at Sense on Cents!!


  • fiscalliberal

    I think blogs like this are critical in terms of aggregating the informaiton. Oh by the way, your readers will be able to ferret out the false stuff.

    By way of example, when the High Level Republicans start spouting off about fiscal responsibility, it is laughable after one looks at the record and the current status of th financial system.

    That said, I am just uncomfortable with the Democrats. Despite his representations the record for Mr Obama in terms of campaign contributions etc would indicate he is bought and paid for. we just have not seen the details.

    Could I suggest the model of savings and fiscal responsibility are no longer valid. We are into printing money and international currency values etc. Getting in front of that with some understanding is probably the issue of the current days.

  • Larry Doyle

    Fiscal…I listened to Martin Feldstein this morning. I find him to be very balanced. He offered some very interesting thoughts about Europe. he said he has been there twice in the last few weeks. He claims that the Euro-zone collectively is “in denial” about the depth of their economic problems and the need for fiscal stimulus. While the EU manages monetary policy on a collective basis, they do not have the structure to do the same on the fiscal front. Germany leads the EU and is very conservative when it comes to govt spending.

    As Lewitt indicates the eastern European debacle, which will clearly spill over into western Europe, will ahve very negative consequences for the global economy.

  • fiscalliberal

    May I suggest that another person well worth listening to is Elizabeth Warren who is the chair of the Congressional Oversight Panel. She calls things like they are and is not affraid to step on toes (in a polite way). However like Sheila Bair, she cannot be bambozzled by rank or bluster.

    She had a recent interview on PBS Fresh Air with Terry Gross which is very enlightening.

    She does not treat Mr Paulson very well. More over she provides a candid view of the mortgage modificaiton program in terms of who it helps and who it does not help.

    The Congressional Oversight Panel website is

    • Larry Doyle

      Thanks for sharing. We’ll all benefit from your providing the link. Much appreciated.

  • lizzy

    It was good to have Lewitt admit that we are in a depression. It has been my sense for over a year that our economy was far worse than people wre admitting. He gave very cogent agruments against the various bail outs too. Initially I might have questioned that more but it seems that we keep allocating money and it doesn’t help.

  • Larry Doyle

    Let’s keep him on the list of people we watch. The link to him will likely be our friend Mr. Mauldin.

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