Juggling Dynamite

The credit bubble bought hideous waste and mis-allocation of capital to non-productive, short-term speculation. This has left an aftermath of market saturation and excess capacity hangovers in real estate, retail, malls, restaurants, vacation services, golf courses…not to mention gambling facilities. This month NJ Governor Chris Christie noted disappointing gaming tax revenues as contributing to large revenue shortfalls in the state’s budget and opted to divert $1.56 billion in required state pension contributions to balance the budget. Taking from future coffers by spending in the near-term has been the dominant fiscal strategy all over the world the past 15 years. Now the future has arrived and it is full of capital and income holes pretty much everywhere.

Atlantic City’s 5-year revitalization plan in doubt as gaming revenues drop 45% since 2006. Here is a direct video link.

Now we are getting somewhere useful…

Struggling to compete with rivals in South Korea or China in businesses like televisions and smartphones, a range of Japanese electronics giants are converting idled factories to agriculture. Here is a direct video link.

Good overview discussion and perspective on our low yield, high risk, capital environment today…and why most financial gurus never recommend low risk (low fees to them) holdings.

For years Great Investor Robert Kessler has correctly predicted that interest rates would decline to record lows and remain subdued because of subpar economic growth. The founder and CEO of Kessler Investment Advisors is sticking to his guns and maintains that U.S. Treasury bonds will continue to be a major beneficiary. He’ll explain why he thinks Treasuries, one of the most vilified investments on Wall Street should be a core holding in everyone’s portfolio. Here is a direct video link.