Sometimes we take a break from all the serious stuff
Those of us who live in Texas sometimes tend to exaggerate as most people know. Texas has its share of problems like everywhere else. But every now and then we get a reminder that we are blessed here in terms of having an environment where many people can make decent living.
So, in this post we'll gratefully thank Forbes for putting Texas at the top of its list this year. This is mostly an off topic post, but it does offer an opportunity to point out that it is sometimes hard to get a proper read on the US economy in total because conditions do vary quite a bit from place to place.
Texas has been fortunate to have a lot of oil and gas reserves which help provide an ongoing base for the economy. Texas has also been able to diversify a lot in recent years so that it is no longer so heavily dependent on the energy industry. Despite the recent plunge in oil prices, the Texas economy is holding up fairly well so far.
A reasonable cost of living helps a lot and Texas is very welcoming to business in general. Some critics point out that Texas has a large number of people without health insurance as an example of an area that needs to improve. Property taxes are also pretty high even though there is no state income tax. Water resources have the potential to be a problem in the future if they are not well managed. But record rainfall this year has removed that issue for the time being.
Some other parts of the country have been slower to recover so talk of a "recovery" in those areas may seem strange to people living there. Lately, Texas has slowed down a little and some other areas have started to pick up some, so perhaps things will even out a little more for areas that have struggled to recover.
One thing we still don't know in the US is if the real economy (not the artificially stimulated economy) can hold up if interest rates are normalized. The Fed badly wants to do some kind of minor increase in rates, but keeps having to hold off because economic reports are not supportive enough. Jim Rickards continues to predict they will not raise rates in 2015 and may even have to return to another round of QE next year. Time will tell on all that.
For now, we are just thankful that things have been pretty stable here in Texas and hope that improved conditions will spread out across the country more and more. Texas won't be immune to a global financial crisis if we get one, but absent such a crisis, things look pretty stable here for the time being.