Now and then//1929, 2009//the coming Depression. Part XIII

By , September 5, 2010 5:16 pm

September 5, 2010Now and then//1929, 2009//the coming Depression. Part XIIIWe are living in interesting times with nothing in view short of despair, loss, chaos, fear and upheaval. For most of us hard working Americans we will probably only see these things on the nightly news. The upheaval and violence will be by the left, the labor unions and those whom have always enjoyed government handouts (wealth distribution). Folks, no matter what the Vice-President, the President, the Treasury and the FED say or do; THERE IS NO RECOVERY AHEAD and soon, if not already, they will know this and start looking for “scapegoats” to take the fall or to get the message out. “Why no recovery is in sight and why things will not get back to normal” First and foremost, no one has yet addressed where that “normal” was or what that “normal” was; they have only addressed that we have been in a recession which became a severe and prolonged recession. What they are now calling a possible double-dip is the beginning of a Depression. They have blamed everyone but themselves and arrogantly even blame others when their actions fail. The Government and to some extend many of us are looking for and anticipating a “recovery” from a recession and are even willing to accept some small swing in the right direction leading us to some level of normalcy. The problem is that we are not in a “normal” recession resulting from a cyclic (every 30/60 years) markets adjustment, a bubble bust in one segment of the market or the failure of a corporate giant which would result in great jobs losses; that would be a recession which could lead to a recovery. What we are in is a “grave and severe financial crises” affecting the global financial institutions. I said it before and I’ll say again, “the global financial heartbeat is on life support”. Obama did not create these crises, it’s been in making for about ten years, but Obama is ensuring that there is NO Recovery soon (at least 10 years). Here are main culprits which created this “financial crises” we are in: (1) to much credit for too long, much of that credit also for a life style beyond our means, (2) speculation-greed, not only by Wall Street and financial institutions but by many of us wanting more, and more, and more, (3) the end result of (1) and (2) is debt, and more debt, and more debt and (4) the wisdom of the progressive left to spend yourself out of debt which always results in more spending and more debt until you are spending to pay only the interest on the debt. One of the main problems with this line of thinking is that this wisdom is almost always followed by stupidity. I’m not an economist, a lawyer, advisor, Wall Street Guru and I don’t have a PHD or 39 Master Degrees coming out of my ass; what I am is 66 years old and I have lived “reality”. The reality of going to bed at the end of 1970 having made $9600.00 that year and at the end of 1972 making $15,980.00 but not living as well (they call it inflation), I’ve lived the gas lines of 1973-1974 and I‘ve lived the price of gas go from $.43 a gallon to $1.15 in less than one year, I lived the harsh conditions of the Carter years; all these things are real, not some fancy explanations by Washington. I feel somewhat qualified to call the Obama administration very stupid in their “economic” policies and decisions, here is why: the Obama administration and the FED perceived this recession as a liquidity problem and over the course of the last 18 months pumped 1.8 Trillion into the economy via bailouts, stimulus and purchasing bad assets from the banking sector; that was only the beginning, they haven’t stopped and won’t. When does $1.8 Trillion “liquidity” rescue not work, and IT CERTAINTY HAS NOT WORKED, nobody is spending, banks are not lending and companies are not hiring. A liquidity rescue does not work when the problem was not liquidity. {Short and Simple-the problem was and is DEBT}. And therein is the stupidity that follows the wisdom of the progressive left. History teaches us that Government most times will make things worse; at best they disrupt the process of “market correction”. You don’t pump trillions into the economy and then straddle it with regulations, job killing restrictions and government controlled mandates.

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