Today’s good news: Your life is going to stink
The left is wrongly interpreting this is mean Charlie Munger is pessimistic about America or as a criticism against the economy, as left wants America to be in decline and no longer exceptional. Actually, what he means is that while America is doing great in terms of technological and intellectual innovation, rising currency, booming stock market, quarter after quarter blowout profits and earnings, huge consumer spending, and political and economic influence – for the vast majority of Americans (those who are not in the financial and cognitive elite), your life will feel like it sucks, even as the economy booms.
Through a relatively new economic phenomena I call bifurcated inflation, wages will lag inflation for many essential goods, despite the bond market alluding to non-existent inflation. That means record high costs for healthcare, education, cable TV, internet, phone plan, daycare, and especially insurance. In America’s increasingly litigious society where everyone is scrounging for a buck and getting sick or in an accident can leave you financially ruined, insurance is a necessity and insurance providers know this, keeping fees high accordingly. Like in Japan, Germany, and Great Britain, interest rates in America are never rising again. Forever low interest rates – even in good times – is another example of how the rules of macroeconomics are being rewritten in the post-2008 era.
Back to the comments by Munger, it’s good news not because it’s good for Americans, but because it’s good that he is acknowledging economic reality that in our era of biological determinism and in our winner-take-all economy, maybe not everyone is cognitively ‘fit’ reap the fruits of America’s strong economy. Some people will be left out, and that’s neither bad nor good, it’s just the way it is. Understandably, these recent socioeconomic developments may make people anxious.
Related: Redefining the American Dream