Sunday, September 28, 2008
Yep this dance is not 10 cents, but free. Why? Cause it's the last dance for a long while, the party is over and we must now walk out and face the sunlight; knowing we stayed way too late, spent too much money, and disillusioned our selves to the best of our ability.
My sister emails me and says, let's cash out and get the hell out of here. Is she in panic mode or is she sane?
You won't hear much talk of the closed congress meetings earlier this year or even know that it existed. Should have been newsworthy considering it was the 4th time in 176 years it has happened. What was the big deal that had to be so secret that everyone had to take an oath of silence on? E told me the other day that they were bringing in troops in readiness for social unrest.
Well apparently what was discussed behind the close doors was this.
The IMMINENT collapse of the financial system by end of 2008
The IMMINENT collapse of the government finances by end 2009
Revolt by the people which causes civil war.
Finally the North American Union.
Perfect storm don't you think? I mean financial issues the likes most of us have never seen, the possibility of a Black President, and that 1 small problem of WE DON'T HAVE FUCKING CIVIL LIBERTIES ANYMORE. We have signed away our liberties to acquire "protection" from terrorists. Martial law can be executed at will now and nothing can save you. Revolt if you want, everything that protected us is now gone.
So that's why I saw those pictures of portable jail cells not too long ago. They look like leggo, they just snap in place.
So maybe you don't think martial law is possible, maybe just internet phobia.
Let's forget about the possibility of civil war, martial law, and the whole 9.
Ok, I'll buy that argument, but Big Sis is still right about packing up.
Let's deal in econ .00101.
I have been asked many times my thoughts on the situation and for me it's hard to explain unless I know the readers level of knowledge.
The following article eloquently explains better than I could:
http://www.financialsense.com/stormwatch/geo/pastanalysis/2008/0926.html
False Values, False Economy,and the Devil to Pay
by J. R. Nyquist
Weekly Column Published: 09.26.2008
Our wretched economy of false valuations cannot continue much longer. It is the domestic counterpart of President Bush’s past friendship with Vladimir Putin. It is the fantasy world of an everlasting bull market and “successful” government bailouts. The political leadership in America has demonstrated that it doesn’t understand economics. They cannot solve the present crisis unless they go back to school and consult the wisdom they have so long neglected. They have built their post- Cold War world on a false boom, on false “partnerships” with enemies. They have pe rmitted a policy of credit expansion without end.
“Credit expansion,” wrote the Austrian economist Ludwig von Mises, “is the governments’ foremost tool in their struggle against the market economy. In their hands it is the magic wand designed to conjure away the scarcity of capital goods … and to make everybody prosperous.” But everyone cannot be prosperous. The boom created by credit expansion cannot last. This is what the leaders of the United States have missed. “The inescapable consequences of credit expansion,” wrote Mises, “are shown by the theory of the trade cycle. Even those economists who still refuse to acknowledge the correctness of the … credit theory of the cyclical fluctuations of business have never dared to question the conclusiveness and irrefutability of what this theory asserts with regard to the necessary effects of credit expansion.”
And what are these effects?
According to Ludwig von Mises, an upswing occasioned by credit expansion can only be maintained by further credit expansion; and, in the long run, “it turns into depression when the further progress of credit expansion stops.” This outcome is absolutely certain and today’s financial crisis underscores the point. The economic boom of recent years has been propelled forward by an unprecedented credit expansion. At each turn, when the market was threatened with contraction, further credit expansion was urged.
The magic wand of credit expansion is like heroin addiction. The more you take, the more you want. The day inevitably comes when you cannot increase the dosage because you run short of supply. And so it is with credit expansion. The markets are accustomed to easy money. They now require easier and easier money. They are addicted. Eventually, however, they must suffer the symptoms of withdrawal.
Did we think this expansion could continue forever without consequence? Evidently we did not consider where we would end up. And now, at last, the United States Government believes it can fill the hunger for credit through a coordinated push – the last gasp of our insatiable credit addicts. President Bush offers a plan. Behind closed doors he reportedly said, “This sucker could go down.” Once again, the president’s grammar is in error. The sucker in question will go down.
Every dollar poured into the proposed rescue operation will be lost. Buying toxic debt is not a solution. The proposed mechanism for rescuing the economy represents a new falsification of values – and a new twisting of the market. The dollar cannot possibly survive this new initiative. A $700 billion bailout is only the beginning. It is merely a foretaste. What we see in Washington is an exercise in self deception. It is the self deception of a country that does not see danger, of a country that ignores the wisdom of ancestors and the ABCs of economics.
They want a booming economy. What they’ve failed to consider is the false nature of the boom thereby engendered. False values, false ideas and promises of false prosperity pepper the program of today’s politicians. They have no business at the helm of a great country. Their leadership consists in pitiful ignorance, and the republic may be in its last days. There has been a shocking willingness to destroy the country’s currency. “If the government does not care how far foreign exchange rates may rise, it can for some time continue to cling to credit expansion,” Mises explained. “But one day the crack-up boom will annihilate its monetary system.”
The proposed plan to save the markets will save nothing. The proposed solution is no solution. Improper investments have been made and massive losses must result. We have to take our medicine before we can get better. Debasing our already debased currency makes things worse. We have avoided economic pain by a continuous expansion of credit. The artificial boom must come to an end. False values must pass away so that real values can be brought to the fore.
Few realize how destructive the boom has been; for the real damage is done by the regime of false values and our collective investment in those values. “The boom is called good business,” noted Mises, “prosperity, and upswing. Its unavoidable aftermath, the readjustment of conditions to the real data of the market, is called crisis, slump, bad business, depression.” The latter, however, is the period of healing and correction.
The real magic of economics is learning to accept correction. This is what we refuse to do. The country’s financial managers set a terrible example. Traditionally, the captain goes down with his ship. As the Titanic sinks today our financiers don’t want to be rescued in a lifeboat. They want to be rescued in a yacht. They don’t want to accept that wars and depressions are necessary because human nature craves fantasy. The bubble of false peace and false prosperity necessarily bursts. In the end, reality must be confronted.
“People rebel against the insight that the disturbing element is to be seen in the malinvestment and overconsumption of the boom period,” wrote Mises. The curious fact is, noted the Austrian: “If we apply this yardstick to the various phases of the cyclical fluctuations of business, we must call the boom retrogression and the depression progress. The boom squanders through malinvestment scarce factors of production and reduces the stock available through overconsumption; its alleged blessings are paid for by impoverishment. The depression, on the other hand, is the way back to a state of affairs in which all factors of production are employed for the best possible satisfaction of the most urgent needs of the consumers.”
If the state is to do anything constructive during the “progressive” period of depression, it is to maintain the country’s nuclear deterrent and preserve national unity. There is no doubt that America will shortly be forced to call its troops home and close its overseas bases. The financial situation is going to dictate international withdrawal. It is going to dictate a more modest government. But the politicians in Washington cling to the notion that the boom can continue, that their false approach to the international situation is viable. The United States cannot save the world. It will be fortunate to save itself. President Bush’s proposed bailout is not simply a socialist measure. It is an attempt to avoid a return to correct valuations. It is an ignorant attempt, in effect, to extend the damage that has already been done.
Our politicians want to give us easy money, a furtherance of the shopping mall regime. They believe this will prevent millions from losing their jobs. They believe that their proposed measures will save ailing banks. Prosperity would then continue. “This reasoning seems plausible,” wrote Mises. “Nonetheless it is utterly wrong.” The boom has made prices and wages too high. Demand has lost all sense of supply. The consumer is accustomed to getting whatever he wants, even though he cannot afford it. In order to put matters right, wages must fall, consumption must be restricted, wasteful practices must come to an end.
“There is no use in interfering by means of a new credit expansion,” wrote Mises. “This would at best only interrupt, disturb, and prolong the curative process of the depression, if not bring about a new boom with all its inevitable consequences.” When Bill O’Reilly says that the disaster is too great, that despite his support for the free market he sees no alternative to the government bailout plan, he is denying the healing power of a depression. He is denying the fundamental lesson of economics. The damage to the economic system has already occurred during the period of false prosperity.
As strange as it seems, financial crash and depression are needful. We must pass through a time of troubles. There is no other way to correct the regime of false values. The problem, of course, has become political. The regime is a political system in which the economically ignorant call the tune. The magnitude of the disaster is thereby amplified. The political actors now put the political system at risk. Because there are national security implications, they now put our very lives at risk.
Copyright © 2008 Jeffrey R. Nyquist
You can't "FIX" this, it is broken. To employ a bailout only keeps the bar open and the band playing another few hours.
Eventually you have to go home.
WATCH THIS VIDEO. PLEASE WATCH THIS VIDEO
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