Remember The Off-Balance Sheet Shenanigans Of Enron?


As the Economy Picks-up Speed

If investment managers such as David Einhorn of Greenlight Capital begin questioning practices of management or, even worse, are short a company’s securities, then it’s often a harbinger of things to come.  Please reference Greenlight’s shorts of Allied Capital and Lehman, among others.

That said, if the following charts prepared by Mary Meeker in the document titled USA, Inc. were attributable to a company, it is likely long/short fund managers would be heavily short, albeit hedged.  In this case, the charts relate to a sovereign nation, which has unique alternatives versus a corporation – namely the ability to print money and create revenues (taxation).  Using these abilities to any meaningful extent exacerbates the problems, however. 


USA, Inc. – Cash Flows

USA, Inc. – Defense Spending

USA, Inc. – Unfunded Liabilities

So, without further ado, please engage yourself with the referenced charts above and in the source file (or at Mish’s blog) – but do so while on a ground floor office suite, as they say.


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