David Fuller's view America on the move

My three and a half week speaking tour of the USA took me from New York to Chicago, Dallas, San Francisco, Chapel Hill NC, Greensboro NC, Washington DC and back to New York before returning to London. It was an exhausting but exhilarating trip with hardly a free evening as we visited with delegates, FMs, old friends and relatives. I have never seen America in a better humoured or more quietly confident mood. There was no complacency or over-confidence but a realisation that things were improving; the government was off the people's backs; there were plenty of incentives and a conviction that hard work produces results.

President Reagan won his massive landslide (repeatedly forecast in these pages) because unlike Mondale he was in tune with the national mood, believed that individual initiative rather than government directives were the key to prosperity and promised merely to let everyone get on with the job. Anti-USA and especially anti-Reagan voices blame the President for every 'bag lady' in the land, say Americans have adopted a 'me first' materialistic attitude and forecast that the budget deficit will soar, pushing interest rates upwards and choking off the recovery. They are wrong. The same people also promote the following myths: 1) That wealth re-distribution helps the poor more than wealth creation. 2) That government owned industries create more permanent jobs than private enterprise. 3) That advocates of sound money have less of a social conscience than the 'borrow and print' fraternity.




The coast to coast optimism which I encountered in November 1984 could hardly be more different from the mood today.

There are other contrasts: the secular bond bull market had resumed following a significant retracement in 1983 and US 10-year Treasury yields were still above 12%. Today, the bond bull is very 'long in the tooth', yields 2.8% and rising. Most equity investors were cautious, not least because of some former highs were being tested, but I liked the speed with which they had rebounded. A young secular bull market was resuming.

I devoted the latter pages of FM9 to my Travel USA impressions.

I return to the USA next month for the 48th Annual Contrary Opinion Forum, where I look forward to the ambiance, scenery, presentations and especially chatting with subscribers.