Friday morning I was watching MSNBC rerun of NBC’s 9/11 morning coverage.  It is very hard to watch the 9/11 rerun and think about the aftermath.  I think our government completely lost focus after 9/11.  They have been flailing at various “enemy” targets at the same time they have worked to restore our “lifestyle”. 

The US has been unable to properly respond in a precise and efficient manner to the world changing events of 9/11.  The whole country went on a spending binge afterwards and the government is now trying to pull the country out of the nose dive that has resulted from the excesses.  The general population has been unwilling to make the sacrifices and life style adjustments necessary to respond to the world environment in which we now live.  The post World War II era has come to an end.  The world our parents and grandparents left us 6 decades ago is long gone. 9/11 probably marked the day the prior era ended. 

The adjustment process to the new world order may have started since it appears that the US population has a renewed savings rate of 7 percent or so.  We will see if reduced consumption and more savings approach will be sustained over a long time period.  However, many different groups of people have their hand out to the US government to make sure their life styles are not impacted by the changes we are experiencing.  We are seeing this take place in the Health Care debate and all the government programs created in the past year.  Many people want the government to take care of them at whatever cost is required.  This is simply not economically possible. There simply isn't have enough focus on personal responsibility.

On the economic front some experts look at the actions of the Federal Reserve and Treasury and believe that we are seeing the ultimate battle between deflation and inflation raging in the market.  No one is sure which way this situation will turn out.  There is no doubt that the Chinese are moving to take over as the world economic leader and redefine the world reserve currency, most likely a basket of currencies plus gold.  It appears the Chinese are accelerating their activity with their recent purchases of commodities around the world.

Gold investors pushed the price of gold over $1000 per ounce today.  This could be the key indicator that the US government and Federal Reserve will ultimately win the economic battle with a flood of fiat devalued US dollars to meet all of the debt and spending commitments the government has created for the future.

9/11 was a wake-up call that we are living in a new and different world.  The world economic and political changes since that day are shouting out to us that the US must fundamentally change its approach to  world affairs, consumption, savings and investment.  Hopefully, enough of us will change our ways before it is too late.

TPM

From time to time our society needs to step back and look at itself.  The world is made of those that create value in our society, those that protect value and those that are overhead.  Some overhead in society is absolutely necessary in order to keep society functioning in an organized manner.  However, at points in time a society, like a company, creates too much overhead and must cut its overhead to survive and then flourish.  I believe we are at one of those points in time now in the US.  We need to get rid of  a substantial portion of our national overhead cost and make our society focus on creating real value in competition with the rest of the world.

I have some general views of which industries and groups of people create value and those that don't.  Which category fits your situation?

Value Creators:  Agricultural Industry, Mining Industry, Non-Defense Manufacturing Industries, Energy Industry, Construction Industry, Telecommunications and Media Industry,  Consumer and Enterprise Services and Distribution, Financial Industry - Capital Investment, Transportation Industry

Value Protectors: Health Care Industry, Education Industry, Environmental Protection Industry, Caregivers and Volunteers, Financial Industry - Banking

Overhead:  Most Federal, State and Local Government Employees, Defense/Government Manufacturing and Services Industry, Legal Industry, Accounting Industry, Financial Industry - Insurance, Non-productive citizens supported by the government.

I have purposely blended many industries into some of the broad categories above.  We must rethink what activities we reward as a society.

TPM