Today I had a realization. Amidst all of the confusion, all of a sudden the economic picture came clear. I was driving in the car this morning and a certain calm came over me.
I’ve been wondering for weeks why there is conflicting economic data and I was unable to make sense out of it.
I know what you’re thinking, Victor you need to get a life. When a moment of clarity about the economy is exciting to you , you need therapy.
So without any apologies, I can hardly contain my excitement.
We are hearing that the US economy is strong, that the economy in Europe is unexpectedly strong. Even in Canada the economy is strong. Employment is strong and we have 50 year low unemployment.
But there is one thing I know about the economy. I treat it like a law of physics.
We all learned about Newton’s second law of physics back in high school. An object at rest will stay at rest and an object in motion will remain in motion. This speaks to the law of conservation of momentum.
We don’t have a corresponding law in economics, but I think the world needs it. That law simply stated is
For every unit of economic output, there is an equivalent unit of energy consumed somewhere in the world.
Host: Victor Menasce