Mark LaPolla From Knight Capital: China Looks Like America Before The Great Depression

“I wanted to pass along some excellent thoughts from Mark Lapolla of Knight Capital.  He was in the latestwelling@weeden and had some excellent thoughts on the overall economic environment.  He touches on a variety of topics including some MMT, but the most interesting portion was his belief that China now resembles pre-depression USA or 1990′s Japan.  Lapolla is astounded at how the world has come to rely so heavily on a “repressive, communist regime employing command and control economic management while violating trade protections and human rights everywhere”.  Attached are the 8 reasons why Lapolla sees similarities between China and USA prior to the GreatDepression:

1) Massive disparity of wealth, income and education

2)  Rapid industrialization and displacement of labor

3)  Opaque and misleading economic and financial data

4)  Massive build-up of leverage across the “rising class”

5)  Bubbles in both residential real estate and fixed asset/infrastructure development

6) Accelerating and uncontrolled growth in disintermediated credit

7)  Expected transference of economic growth to domestic demand.

An accelerating price/wage spiral

I highly recommend reading the piece in its entirety.”

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