|Credit: Boston Consulting Group
I think this is business and the media chasing "hot trends", as opposed to looking at the long-term picture. [I've made a ten-year dinner bet with an old high school classmate about the share of US manufacturing as a percentage of US GDP. He says it's going to be higher in 2022 than in 2012; I say it's going to be lower.]
So a couple of new-ish things to comment on:
- There is a lot of talk about the an American manufacturing renaissance due to hydraulic fracturing, all the natural gas/oil that is going to be produced and the cheap energy that's going to result. I think that's really real and why serious federal regulation of either 1) hydraulic fracturing or 2) carbon emissions will not happen during President Obama's 2nd term. There are just too many oxen to gore.
- Also, Ben Bernanke has just announced that the Fed will keep rates low for the foreseeable future until unemployment falls below 6.5% to inflation goes above 2.5%. This is a pretty bold step* and shows their commitment to lowering unemployment as much as possible. So it won't be hard for companies to borrow money for the foreseeable future.
I don't see it at all, but I'd be interested in hearing a contrarian opinion. Readers?
UPDATE: The ever-awesome Rich Apodaca has some thoughts on how it could happen.
*and a big screw-you to net savers. That part is frustrating, if understandable.
** That's probably driven by hydraulic fracturing more than anything else.