We can only pray this is true.....

World power swings back to America

The American phoenix is slowly rising again. Within five years or so, the US will be well on its way to self-sufficiency in fuel and energy. Manufacturing will have closed the labour gap with China in a clutch of key industries. The current account might even be in surplus.

By Ambrose Evans-Pritchard, International Business Editor

5:53PM BST 23 Oct 2011

Assumptions that the Great Republic must inevitably spiral into economic and strategic decline - so like the chatter of the late 1980s, when Japan was in vogue - will seem wildly off the mark by then.

The author goes on to explain:

1. The U.S. has already increased it's supply of oil for its own consumption from 50% to 72% in the last 10 years.
• "The implications of this shift are very large for geopolitics, energy security, historical military alliances and economic activity. As US reliance on the Middle East continues to drop, Europe is turning more dependent and will likely become more exposed to rent-seeking behaviour from oligopolistic players," said Mr [Francisco] Blanch [from Bank of America] .
2. According to a recent Boston Consulting Group report: 
• Chinese wage inflation running at 16pc a year for a decade has closed much of the cost gap. China is no longer the "default location" for cheap plants supplying the US
3. The fed has "unintentionally" created inflation in China.
• As Philadelphia Fed chief Sandra Pianalto said last week, US manufacturing is "very competitive" at the current dollar exchange rate. Whether intended or not, the Fed's zero rates and $2.3 trillion printing blitz have brought matters to an abrupt head for China
4. Things are getting worse, not better in the EU.
• The European Central Bank has since made matters worse (for Italy, Spain, Portugal, and France) by keeping rates above those of the US, UK, and Japan. That has been a deliberate policy choice. It let real M1 deposits in Italy contract at a 7pc annual rate over the summer. May it live with the consequences.

The bottom line is, we are likely to succeed where others have failed because when the playing field becomes more level, manufacturing will likely come back the U.S.  States like South Caroline, Alabama and Tennessee will become the lowest cost place to produce products (along with other factors like infrastructure and security).  

Here's to hoping they are right!