>The risks? Well, if house appreciation stops and eliminates balance
>sheet saving, consumer might actually increase the saving rate out
>of current income and spend less, and the housing sector would slow.
>No one knows the trade balance for California, so maybe the trade
>deficit doesn't really matter. Bad management - capital flows out
>of a "country". Good management, capital flows in. Certainly the
>world can't afford a U.S. recession and it appears that other
>countries are willing to help make sure we don't have one. Energy
>prices? Higher in real terms in the early 1980s. Workers log fewer
>hours to buy ten gallons of gas today than they did back then. Oil
>consumption per dollar of GDP is half of consumption thirty years
>ago. It's just that GDP is so big! We consume twenty-five percent
>of the daily world production and have three percent of proven
>reserves. No energy "independence" in the near future (like
>decades). We can't even build a new refinery (last one in the
>mid-1970s). Lots of risks, but then again, there always are.
>Overall, growth is still looking pretty good.