JPMorgan investment management is in the business of keeping the money not making the money. They are worried about a lot of things; geopolitical risk, energy prices, de-leveraging and the end of the carry trade, a housing collapse, the end of the US consumer, inflation, and the wrath of nature. But evidence shows that none of these are "the end of the world". Wars cause dips, energy prices fluctuate, the carry trade might never have been, and the consumer never dies. Nature's wrath is localized.
He gave a nice summary of the Greenspan thesis: the fall of the Berlin Wall brings capitalism to the masses (more Marxists on the Harvard faculty than the rest of the world combined). Agrarian markets with high savings rates grow and continue to save. The savings flow to the US.
Is it true that there is prosperity but no security? Was there any security except for a brief period of time post World War II?
He joins the other speaker I saw this week going gaga about China. Take current growth rates of China and the United States. Draw a straight line. Predict the year that the Chinese economy will be larger than the U.S. I think that the year that Japan was 2005.
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