On Sep 15, 2007, at 2:30 PM, Eubulides wrote:
> Foreign investment in
> 2003 was $130 billion compared to $115 billion here at home. So we
> don't
> have a huge amount of excess capacity and, if we were to cut the
> current
> account deficit by only 25 percent, our capacity utilization rate
> would
> increase from 79 to 86 percent. If we cut the deficit in half, the
> utilization rate would go to 93 percent." David Hale:
>
> <http://www.levy.org/default.asp?
> view=publications_view&pubID=10654b0b370>
Bernanke's point is that we need investment to increase capacity. The Fed doesn't like cap'y util much above 82%.
Doug