Subject: Re: Ackman explains his position on buffett
Mar 1
Warren Buffet explains how he can end the US deficit within 5 minutes

It's a much better solution than the prior idea he had: requiring that all importers purchase import permits for the dollar amount of what they're importing, the permits being generated dollar for dollar by someone else's exports. That would crater the world economy. Though there would be no current account deficit.

My favourite macro question: is the current US administration (or for that matter, Mr Buffett) in favour of non-US individuals and companies investing money in the US, as they generally have been doing? Buying shares, building factories? Would they like to see more of that? The reason I ask is because that is what is called a capital account surplus. By definition, a capital account surplus is equal to and opposite a current account deficit. Somebody who wants to eliminate one had better be in favour of the other, whichever direction they prefer.

The government sector aggregate deficit is a much better target than obsessing about a current account deficit.

Jim

(yes, there are some finer points about what's in the capital account, like central bank sterilization activity, but that doesn't dominate)