Subscribe: RSS Feed | Twitter | Facebook | Email
Home | Contact Us

Mary Meeker Audits USA, Inc. Recommended

Posted by Larry Doyle on August 9, 2011 9:39 AM |

In the course of a conversation yesterday with one of the wisest men I know, I remarked that the issues our nation faces are not political but rather mathematical.

The debate in Washington that put a choke hold on our nation, our economy, and our markets took partisan bickering to an entirely new level and focused on the politics.

In the true spirit of ‘sense on cents’ let’s focus on the numbers and reduce our issues and our problems into simple math. In the process, I hope we are all more educated as to the depths of our problems so we can then begin to address them.

I thank a dear friend who brought a recent fabulous presentation by Kleiner Perkins’ Mary Meeker to my attention. 

Many fully informed readers will readily absorb Ms. Meeker’s all encompassing presentation. That said, I want to highlight Ms. Meeker’s work in the hopes that younger generations, students, and those looking for information on our nation’s fiscal situation can gain a deeper appreciation as to the depths of our problems. They run very deep.

Mary embraces a pursuit of the truth and facts, a simple virtue which I hold dear. She promotes transparency, another of our cornerstones to achieve real ‘sense on cents‘. Lastly, Mary is clearly a model of integrity. As such, I welcome immediately inducting her into the Sense on Cents Hall of Fame.

I hope if this commentary and Mary’s work crosses your path that you will find a convenient hour to review it. I would hope that you would then find it compelling enough to share with others, especially students.

For the long term well being of our nation, all Americans need to embrace Mary’s ‘audit’ and understand the basic math which she presents. It is only our future that is at stake. Only? Yes, only, and for the sake of my kids and your kids let’s fight for it.

Larry Doyle

Isn’t it time to  subscribe to all my work via e-mail, an RSS feed, on Twitter or Facebook?

Do your friends, family, and colleagues a favor and get them to do the same. Thanks!!

I have no affiliation or business interest with any entity referenced in this commentary. The opinions expressed are my own. I am a proponent of real transparency within our markets, our economy, and our political realm so that meaningful investor confidence and investor protection can be achieved.

 

  • Rob

    Most people need to watch this.

    • Bruce

      Larry, as simple as she makes it, I can surmise that most will ‘poo-poo’ her numbers and think “it can’t happen here” (as in the old Zappa song).

      I am reading awful, dishonest, self-serving stuff coming out of major institutions telling people to ‘stay the course’ blah blah. What, like most of us did back in 2008? Sorry, I bailed out a month ago, and what we are engaged in now I can sit back and happily wait for the bottom, no matter how long it takes, and slide back in. It is early still.

      Back in the early eighties Paul Volker rescued us from a rather dire situation, and it is entirely within grasp for someone to come along again. Chris Christie perhaps?

  • lizzy

    She does a great job of bashing senior citizens but contributes nothing positive on how to increase jobs. I am not inclined to pour more money down the rat hole that education has become. We have spent money one research and development to have corporations involved send jobs and factories to China. I won’t support any reductions to Social Security until they come up with a way to stop the out sourcing of all our jobs It is an insult to talk of means testing Social Security; we paid taxes both workers and employers on earnings up to $100,000. yet if we have assets we are to be means tested? If they get some jobs back, tax revenues will go up. Personally I think we need to cut way back on our politicians goodies. No pensions, no health care unless they pay full cost, salary reductions to $50,000. a year, and strict term limits. Also no security after they leave office or secretarial staff.

  • Cate

    Meeker has the numbers part pretty good. But she fails entirely in providing any real solutions and even more miserably in disussing any cause. Until the massive corruption and huge parasitic monkeys are thrown off, these numbers won’t successfully be addressed.

  • Bill

    When politicians and business leaders first saw this report, they buckled or defensively denied their own culpability for the serious and massive negative consequences of the growing structural ‘tumors’ that they ‘fed’ since the 1960’s with mirrors and fast-talking. Much of our strength and influence has been sold, squandered and/or exported unwisely, greedily by those who have foolishly worshipped at the altar of shallow egos, short-term gains and inaninmate fool’s gold, however, the bell has tolled. America is the leader of political technology,and anyone who steps back and watches the structural changes occuring within every emerging or developing country, every emerging or developed religion, and every emerging or developed company sees that spirit of liberty,self-reliance and incomprensible energy to improve. Let’s get on with the surgery, cut out the fat and ‘free rides’, and may our children take over from the obsolete phonies. Let’s change the voting age to 16.

  • fred

    You can’t refute the facts, Mary is spot on.

    I couldn’t help asking myself how we got into this mess, so I pulled out some 100 year charts on statistics, economic and asset returns to see if I could find any clues.

    The first thing that jumps out at you is the population change during the 1940’s; initially population growth drops dramatically during the war then spikes much higher immediately following the war, the significance of this event on our current situation has not yet occurred so I will save comments for later.

    The next event of significance occurred in 1970, at first I was at a loss but then I read an article over the weekend about the 40 year anniversary of the removal of the gold standard, everything began to make sense.

    The initial spike in inflation (cpi and GDP deflator), the depreciation of our currency, the oil shocks of the 1970s, the need to reconfigure CPI to subdue inflations impact, it all started with the removal of the gold standard.

    Interestingly, the charts tell a different story than common belief, it wasn’t Volker that broke the back of inflation by raising rates, it was the reconfiguration of the CPI calculation in 1980 that served this purpose.

    LT treasuries price off ST rates and CPI inflation expectations, ST rates price off current CPI inflation. When CPI became muted after the computation change, the LT bull market in the bond markets began (and continues to this day).

    In reality, inflation didn’t magically disappear in 1980, it just wasn’t being captured any more by CPI. This can be seen clearly in the major divergence that developed, starting in 1970 and continuing to this day, between CPI and the GDP deflator.

    Getting back to gold, with the Vietnam war winding down, Nixon had a problem, how could he boost gov’t spending and GDP with the “gold collar” in effect, his solution, remove it. This was the beginning of an unrestrained rise in gov’t spending by both dems and pubs, ‘with the $US being the global reserve currency, “who cares how much we spend, we can just print our way out”.

    Clinton wasn’t any magic elixir either, artificially low rates (thanks to CPI computation) and the introduction of securitization boosted both the stock and real estate markets, and subsequently, tax receipts.

    As evidenced by LT charts, earnings of the stock market are a direct multiplier of the financial industry earnings, higher stock and real estate prices means = higher cap gains. The problem, unsustainibility.

    The LT growth rate in the real estate market on a LT chart is 3-4% yr, in stocks 4-6% + divs, these bubbles had to pop, and they did. Both these bubbles are also clearly evident in the LT employment charts, when these bubbles popped, (dot.com and MBS), unemployment spiked as workers are forced to relocate to the next areas of the financial industry.

    Coming full circle, the spike in population is at or approaching retirement age, we’re talking major draw downs in entitlements, most specifically Medicare.

    I am not a Congressman Paul supporter, but he is the only candidate who has identified gold as being significant, and he is also an M.D., do you think he knows anything about medicare?

    Interestingly, in Iowa, he came in a virtual tie for 1st, but not even a mention of his strong showing. The media dismisses him as a viable candidate and paints his position on a gold standard as extremist.

    And the game goes on.

    • LD

      Fred,

      Thank you for both a real history lesson and a wealth of ‘sense on cents‘.

    • Cate

      Fred,

      Definitely a concise and succinct summation of recent modern history, thank you.

      While I agree that Congressman Paul didn’t receive much attention after Iowa, his words may be better heard should he remain in the audience and hold our next round of elected leaders’ feet to the fire.

      He is definitely at the top with his wisdom and courage to speak his mind, and where ever he lands he will continue to serve We The People.






Recent Posts


ECONOMIC ALL-STARS


Archives