Pershing Square’s Bill Ackman Discusses Obama and Social Unrest

October 7, 2011

Hong Kong Peg : Minute : 18
Occupy Wall Street : Minute 34

  • Obama is akin to the CEO of the largest business in the world.  If that business is not successful, we can’t defend ourselves, we can’t feed ourselves, and we’re going to have demonstrations. We’re going to have civil unrest and our government can be overthrown.
  • The President has had an anti business campaign. Legislation has made business more difficult. The next President is going to have to make the US succeed as a business, otherwise we are toast.  The good news of the United States is the rule of law is still generally good.

 The protests should not be a surprise, given we know that bailouts of non government entities is a risk factor in violence against the governments.  The US has a much lesser degree of oppression than countries at risk of a regime change, but the trend is not headed in the right direction. Political oppression is increasing as is financial repression. “Financial repression is when governments force captive domestic audiences, to invest in treasury bonds, put implicit caps on interest rates, and [implement] tighter regulation of cross border capital movements.” US policymakers are pursuing an inflation tax, higher income taxes, regulatory taxes, and are forcing consumer purchases, like health care.  This is real financial oppression and it is escalating, so we should expect a public backlash to continue so long as these policies are in place.

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