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Its from Onion
Jul 2, 2009, 7:26:51 PM7/2/09
to TSCM-L2006
Subject:
Bronner Speaks In Tuscaloosa..
Dr. David Bronner, CEO of the Alabama Retirement Systems, the 43rd largest investment fund in America , spoke at Rotary Club here yesterday. He is one of the most respected fund controllers in the United States today by his peers.
Bronner had the following to say:
1) Next month, July, California hits the wall financially, that will send a ripple effect across the US economy, AND over the next two years one state after the other will fall to it's knees financially as the federal government stimulus package ends by 2011. It has helped various states at different levels comparative to their economic condition. He says the stimulus package is what's been keeping the states alive for now...except for California which was in such terrible shape the stimulus package wasn't enough to really help them. "They go first." He said Alabama would hit the wall in February of 2011, late in the game as Alabama is in better shape than other states. Bronner says Alabama might dodge the bullet if the economy revives enough by then. But, he doesn't really think things will improve enough by then to avoid a crisis..."It will be the largest economic crisis in the history of the State of Alabama" Bronner says Alabama will experience such significant shortfalls by 2011 that taxes will have to be raised substantially to avoid collapse...probably on property. And that practically all states will face a similar fate.
2) Within 120 to 150 days from now the commercial real estate market nationally begins to collapse as stores, malls, and shopping strips, and industrial plants have enough closures (store and plant) and loss of rental revenue to make them unable to pay their mortgages. They will start going into foreclosure unable to pay their mortgages in a significant way at that time creating a second wave of economic disaster starting three to four months from now.
3) Unless oil stays above $70 a barrel Russian and Mexican economics will begin to unravel as countries ("socio-economic collapse") economies require that much from oil to have an adequate revenue stream to feed their people and economies. AND, the only other big revenue stream for Mexico is illegal drugs sold in the US...so their economy will intensify their focus on selling drugs in America as a result in order to survive if oil doesn't stay above $70...he said $90 would be better for them.
4) The US economy (according to Bronner) is today like a patient in the emergency room in the process of having a heart attack. He said people tend to think of it as being in the hospital for cancer or chronic disease. Without the huge Bush stimulus, and then the huge Obama stimulus, the economy would have already flat lined...(i.e. we'd be experiencing a Great Depression style economic collapse heading toward 25% unemployment or so as the tumble would have continued and intensified at an increasing rate, with the stock market hitting around 2,000) Bronner said the depth of the crisis was greater than ANYONE realized and agrees today, after learning the extent of the crisis, that the federal government simply had to start "shoveling" money at it to prevent a true and complete collapse of our economy. He said he, at first, was mad at this shoveling of money until he learned the truth about the amount of money necessary to prevent a total collapse which he believes would have happened.
5) Inflation will not arrive for 3 to 5 years as the economy is in a deflationary stage due to the economic plummet...and will not experience inflation until people start "buying things" again, and that's going to take a while! He also believes 3 to 5 years is probably the term until true economic recovery establishes in the US and world economy.
6) China must start selling their products to people in their own country and paying their workers enough to buy them. This would increase their products prices, reducing their exports (and "besides they will lose interest in having more US dollars anyway") and enabling other countries (US) to compete with them.
7) The greatest threat to the US economy is one of around 9 world events that could heap misery on top of misfortune at exactly the wrong time. A nuclear incident with N Korea, a plague, Israel attacking Iran (oil shock), or such could still throw the US economy into a Great Depression style situation. He said the greatest risk of this is anytime from now until the world economy gets somewhat back on it's feet...in 3 to 5 years.
I thought you might find what Bronner had to say interesting. You may or may not believe it. But, at least it's from a credible and intelligent source.
Dr. David Bronner, CEO of the Alabama Retirement Systems, the 43rd largest investment fund in America , spoke at Rotary Club here yesterday. He is one of the most respected fund controllers in the United States today by his peers.
Bronner had the following to say:
1) Next month, July, California hits the wall financially, that will send a ripple effect across the US economy, AND over the next two years one state after the other will fall to it's knees financially as the federal government stimulus package ends by 2011. It has helped various states at different levels comparative to their economic condition. He says the stimulus package is what's been keeping the states alive for now...except for California which was in such terrible shape the stimulus package wasn't enough to really help them. "They go first." He said Alabama would hit the wall in February of 2011, late in the game as Alabama is in better shape than other states. Bronner says Alabama might dodge the bullet if the economy revives enough by then. But, he doesn't really think things will improve enough by then to avoid a crisis..."It will be the largest economic crisis in the history of the State of Alabama" Bronner says Alabama will experience such significant shortfalls by 2011 that taxes will have to be raised substantially to avoid collapse...probably on property. And that practically all states will face a similar fate.
2) Within 120 to 150 days from now the commercial real estate market nationally begins to collapse as stores, malls, and shopping strips, and industrial plants have enough closures (store and plant) and loss of rental revenue to make them unable to pay their mortgages. They will start going into foreclosure unable to pay their mortgages in a significant way at that time creating a second wave of economic disaster starting three to four months from now.
3) Unless oil stays above $70 a barrel Russian and Mexican economics will begin to unravel as countries ("socio-economic collapse") economies require that much from oil to have an adequate revenue stream to feed their people and economies. AND, the only other big revenue stream for Mexico is illegal drugs sold in the US...so their economy will intensify their focus on selling drugs in America as a result in order to survive if oil doesn't stay above $70...he said $90 would be better for them.
4) The US economy (according to Bronner) is today like a patient in the emergency room in the process of having a heart attack. He said people tend to think of it as being in the hospital for cancer or chronic disease. Without the huge Bush stimulus, and then the huge Obama stimulus, the economy would have already flat lined...(i.e. we'd be experiencing a Great Depression style economic collapse heading toward 25% unemployment or so as the tumble would have continued and intensified at an increasing rate, with the stock market hitting around 2,000) Bronner said the depth of the crisis was greater than ANYONE realized and agrees today, after learning the extent of the crisis, that the federal government simply had to start "shoveling" money at it to prevent a true and complete collapse of our economy. He said he, at first, was mad at this shoveling of money until he learned the truth about the amount of money necessary to prevent a total collapse which he believes would have happened.
5) Inflation will not arrive for 3 to 5 years as the economy is in a deflationary stage due to the economic plummet...and will not experience inflation until people start "buying things" again, and that's going to take a while! He also believes 3 to 5 years is probably the term until true economic recovery establishes in the US and world economy.
6) China must start selling their products to people in their own country and paying their workers enough to buy them. This would increase their products prices, reducing their exports (and "besides they will lose interest in having more US dollars anyway") and enabling other countries (US) to compete with them.
7) The greatest threat to the US economy is one of around 9 world events that could heap misery on top of misfortune at exactly the wrong time. A nuclear incident with N Korea, a plague, Israel attacking Iran (oil shock), or such could still throw the US economy into a Great Depression style situation. He said the greatest risk of this is anytime from now until the world economy gets somewhat back on it's feet...in 3 to 5 years.
I thought you might find what Bronner had to say interesting. You may or may not believe it. But, at least it's from a credible and intelligent source.
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