Eye opening opinion in Jeremy Grantham's latest letter to investor. He lays it out pretty well and it's a little scary. I wish I could write as succinctly as he does. He's one of my favorite financial people to follow and I put a lot of weight into what he says. Here's a quick quote.
- "Separate from the “seven lean years” syndrome, the U.S. and the developed world have permanently slowed in their GDP growth. This is mostly the result of slowing population growth, an aging proﬁ le, and an overcommitment to the old, which leaves inadequate resources for growth. Also contributing to the slowdown, particularly in the U.S. and the U.K., is inadequate long-term savings. As I write, the U.S. personal savings rate has fallen once again below 4%.
- In addition, and sorry to harp on this, the U.S. in particular has rapidly acquired relative deﬁciencies over the last 20 years that will hamper the effective functioning and growth of its economy. Relative to other developed countries, and an increasing number of developing countries, we are sliding in some key areas that threaten loss of competitiveness:
- Notably depleted infrastructure
- Marked fall-off in the effectiveness of education and training
- Much decreased effectiveness of government, particularly in its ability or even willingness to concern itself with long-term issues."