You ought to read this essay: The seething, by David Glenn Cox. It is good and finishes with a bang!
It reminded me of Obama's latest pronouncement that FOR SURE we are now in a recession and he wants the government to do a second "economic stimulus package" — which, from recalling him saying this sort of thing before, I take to mean more $600 checks.
I liked my $600 check. I didn't need it, not in the way that some people needed them, and I did spend it immediately on solid things like food, truck maintenance etc. But let's not blow off another $65 billion from the Treasury, eh?
Sending out those checks to rich and poor alike is ridiculously inefficient (which probably means that, for a government program this was a relatively successful operation...)
The galling thing for me about Obama's "chicken in every pot" strategery is that he is one of the millionaire Senators who still believes that the US government has unlimited wealth available and can bestow trillions of dollars effortlessly, without even thinking twice, or worrying about paybacks. "Deficits don't matter" is a belief of Republicans and Democrats, though only Dick Cheney came out and actually said it.
In fact, the US as a nation has a credit
The only thing the US government has going for it now is that there are many countries with even less effective national leadership.
The world has been in a Currency War, a war to print money faster than the other guys to maintain export competitiveness, and something like 50 countries now have 10%+ inflation rates.
But if the US government's spendthrift policies continue I expect the people of the world to stop buying US dollars as "reserves" and to load up on other things, like, say, gold - or anything else, really.
And if that happens, we're in deep shit.
rating, and right now it is "AAA". But that rating is "on watch" and if it drops to "A" or "A-" or worse, then a world of hurt is going to materialize and drive up interest rates for all borrowing.
The event risk at hand right now is a trillion dollar bail-out of Freddie Mac and Fannie Mae. If the US nationalizes those two then our credit rating deserves to drop to "junk" status. Only a fool would lend the crackheads in Washington D.C. long-term money at 4.5% interest.
The only thing the US government has going for it now is that there are many countries with even less effective national leadership. The world has been in a Currency War, a war to print money faster than the other guys to maintain export competitiveness, and something like 50 countries now have 10%+ inflation rates. But if the US government's spendthrift policies continue I expect the people of the world to stop buying US dollars as "reserves" and to load up on other things, like, say, gold — or anything else, really. And if that happens, we're in deep shit.
Actually, one thing that might help us a little bit is a "relief rally" when Bush leaves office. That moment of ecstasy will last about as long as a pub crawl, and then we're back to Real Reality because the Democrats in Congress are tragically wrong about monetary and fiscal policy. Too bad Ron Paul is treated like a crank in D.C. He's about the only person with a clue.
