So China was barking at Henry Paulson that we have to get our shit together and follow their model for economic management and growth. This to me is a little like a guy who beats his wife giving advice to the guy whose wife has just run away with the tennis pro - "if you'd just kept her in line, you wouldn't be where you are today now would you?" The real reasoning behind China's "advice is twofold; first, without the great American consumer, their little manufacturing engine backs up on itself, and they hold a HUGE number of dollars.
My brother said it best a few months ago - "inflation is our last great 'fuck you' to China and other net dollar holders." If inflation starts to roll, China's dollar holdings get seriously devalued and their tactic of propping up American consumers by holding dollars gets prohibitively expensive. Somewhere shortly thereafter, the wheels come off their wagon pretty badly.
This is not to say that some regulation isn't necessary. The whole off balance sheet bullshit that propped up Enron's charade and is now going on with hedge funds and myriad other stuff needs to be swept away. Executive compensation needs a swift kick in the pants, and all of the increasingly arcane financial instruments starting at credit default swaps and going from there need to be reined in. How exactly this happens and who is trustworthy enough to manage it are problems, as the saying goes, above my pay grade. But if the local S&L was still a prominent feature in the landscape and originating, owning and servicing local mortgages, do you think that we'd be talking about a sever housing meltdown right now? Probably an abundantly simplistic viewpoint, but the guys who are developing all of this financial esoterica in hopes of Solomonic rewards pretty much need to be locked up. It results in a historical concentration of wealth even beyond the robber barons (whom, it could at least be argued, MADE something - roads, railways, shipping lines, materials).
Here is a great article about housing and development. Put simply, America's existing building stock and urban networks are looking like a better and better asset. If I had the wherewithal to do it, you can bet that I would be knee deep into urban redevelopment projects. Not these overwrought pieces of crap where some developer blinded by dollar signs, with a sales agent bleating stupid advice about what the consumer demands, takes a sow's ear and tries to turn it into a silk purse, replete with stainless appliances, granite countertops and 1.5 bathrroms for every bedroom. No, you have to make sense with these things. I always laugh when I see these projects in "transitional neighborhoods" that are absolutely loaded to the gills with luxurioous amenities. How about reasonable stuff that people can afford?
Another article I read yesterday talks about how McMansions in the suburbs and exurbs are likely to serve a quite different demographic than the one for which they were intended. It appears that we're rapidly approaching the tipping point where gas prices will have a systemic effect. Several subcontractors with whom I work drive 150 miles a day in pickup trucks to get to work. That's about $200 a week in gas. Think that's going to last? $800+ a month for the priviledge of wasting half of your life in traffic?
Speaking of traffic, Mrs. Wagon and I drove to NJ for our nephew's birthday this weekend. It was my first away game since the crash. No traffic. Normally, leaving on a Friday evening in the summer (technically late spring) would be a bloodbath. We sailed up the road the whole way there.
I'm psyched for the Tour this year. ASO doesn't get the highest marks for their somewhat shady and duplicitous handling of different things, but I think the racing is going to be great. I hope there are no scandals, and I look forward to watching Valverde, the Schlecks, Cavendish, Cunego, Kirchen, Thor and team Slipstream-Garmin-Chipotle (good week to be in the sponsor market, huh?) battle it out in their various quests.
Go Celts. Jesus Shuttleworth, you certainly do got game.