As an unabashed admirer of America’s so-called “small business” economic core strength, I believe that the ability of these independent enterprises, whether manufacturers, distributors, contractors, retailers, or architect/engineers, etc. to generate entrepreneurial drive is what’s keeping the U.S. economy functioning better than expected.
The fact that the world’s dominant financial powers still view the U.S. as the prime target for their fixed and liquid asset investment is proof positive of their long-term confidence in the U.S. The most credible example of that is the outstanding size of the world’s surplus invested in the U.S. Treasury’s growing debt paper positions— one of the reasons that the outstanding 10-year note is still projecting a high price and a low yield. With the U.S. Federal Reserve Board and foreign investors pouring multi-daily billions into the purchase of notes and bonds all along the yield curve, the Fed’s policies of keeping interest rates down are well secured.
Further buttressing the solidity of America’s business/industry, financial institutions, and the nation’s general fiscal condition is that the U.S. is exhibiting extraordinary financial strength at a time of continuing high unemployment. The combination of the aforementioned factors are reinforced by the hundreds of thousands of “small businesses” sitting on mountains of cash, not being utilized for expansion or new acquisitions or additional product lines.
The hold-back on hiring by the independent business sector, which traditionally employs 80% of the nation’s potential jobs pool, is primarily responsible for the unusually high national unemployment level. This appears to be out of sync with the overall 2.5% growth level that is being currently experienced during the current post-recessionary recovery. It must be remembered that despite the fact that 25 to 30 million are not now employed full time, a large percentage of the 160 million full-time worker potential is generating the bulk of the producer and consumer demand keeping the U.S. economy at a better than expected level as it nears the halfway point of the 2013 calendar year.
Much of today’s “structural” unemployment is caused by the technological boom on the shop floor and back offices, which is making hands-on jobs in many business/industry sectors obsolete. Unquestionably, the highly-accelerated entitlement expansion has supported the consumer buying power that has kept the overall demand level in positive territory, while adding to the record national debt.
Also, the apparently more benign Administration’s position on energy development is generating a disproportionately significant level of revenues and employment in those states like Texas, North Dakota, Alaska, West Virginia and Pennsylvania, which have been given the green light of “full-bore” expansion. Lately, the Administration has also been effective at keeping excessive EPA restrictions at bay by delaying actions.
To view America’s economic future realistically, the categorizing of each of the 50 states by their approach to economic growth, and tax abatement, as well as overall business-friendly direction becomes a more realistic method of analyzing American forthcoming potential.
For future easy access to my blogs, please use the link below, and bookmark it to your desktop. The old link you may be using is still available. However, an alternate link is: http://mydesert.com/beschloss