All the quiet coming out of Iraq recently, including the Economist story with the distinctly Vermeeresque cover, would seem to indicate that if there's one place to invest today where you know things aren't going to get worse, it might just be Iraq. They do, for example, have oil. How to actually get retail money there is another question.
The ever-authoritative USA Today reports that the pesky Lebanese and Rumanian are getting the jump on us. Perhaps Bills Miller and Gross will be on the next plane out.
Friday, June 27, 2008
Investing in Iraq
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8 comments:
Business Week had a cover story on Colombia, with the headline, "Extreme Emerging Markets." Until the more recent serious problems, the investor community was getting anxious about where to go for strong economic growth and outsize returns. US growth in recent years has become anemic with no remaining advantage relative to European growth. And even the emerging markets are starting to feel a little "been there, done that." So it's off to Colombia and Iraq.
Thankfully, I think that day is over, and we've got plenty to do at home to make things right. Let's start with investing in some public transportation infrastructure. Do you think a $10 billion tunnel under the New York harbor might create a few jobs?
I dunno. I think spending money on public works just to create jobs is dangerous, as we've seen in Japan and Alaska and Thailand and elsewhere. Boondoggles abound.
As for a tunnel, that's gotta be about what the tunnel facilitates and not about jobs for the tunnel itself. Labor markets in America are not yet that bad by historical standards.
That said, in general I think infrastructure is a good place for us to concentrate now. It's a better place for taxpayer billions than Iraq. That's where the private sector may hope to do some good sometime soon as the military gets the fuck out, on a rational schedule.
Steed and Graham comes alive- if you want to stimulate growth you have come to the right place. Chew Your Grouse produces prodigious results that will cause Angelina to leave Brad. She will no longer wish you were still at work. Apply liberally.
stimulation, growth, that's what I'm talking about. large size projects that deliver sensation.
This country has tremendous room for improvement in the efficiency with which we use energy. I think in the post-Jimmy Carter era the widely held opinion is that constraining energy use has a dampening effect on the economy and will lead to lost income and jobs. This is probably right in the near term. But if the market has ever sent signals that we need to re-arrange how we live, it is sending those signals now.
How about a little more train service in the NY area? I have a train stop 5 minutes from my house that has no departures for Grand Central between 8.09 and 10.50. The trip takes one hour 53 minutes. I can drive in in an hour twenty if there's no traffic. Wake up, America. There's some work to do. (or we could move)
The freight tunnel under the NY harbor was studied by NYC's economic development corporation. The idea is there is a lot of truck traffic into the city from the Elizabeth ports because there is no freight train coming into NY any more. Talk about waste. Probably several million truck trips per year through those clogged tunnels.
I blame Reaganism. Reagan felt that the state had come too far and we could boost the economy by relaxing regulations. He was right, but jeez, my god, what a legacy. A political system in which one side is ideologically opposed to regulation on principal and ideologically in favor of cutting taxes. Think of all the billions we made in the 1990s and even in this decade, how is that wealth reflected in the physical landscape? McMansions? I'm going to throw up. Go to any other country after a period of prosperity. You will see gloroius avenues lined by oaks or palms, depending on the latitude, leading up to limestone courthouses or museums. We have still have potholed turnpikes, clogged tunnels. See if Josh Stein can make a difference.
Prior to enhancement cream augmentation "Steed" was known as "Pony Boy".
Steed, man.... if I had known I was picking an argument with a frickin economist, I woulda held off.
No but seriously, your point about McMansions as the emblem of recent "wealth creation" is well taken. Granite countertops and shiny dishwashers, that's what we got. I'm generally with you on infrastructure, though I have a sneaky suspicion you're trying to stoke up some public private partnerships.
Wealth creation... I have an embarassment of riches...in my pants.
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