Ok, I don't expect everyone to read the following, but I was hoping that somebody might. If you do happen to read it, would you mind telling me whether you think it's a republican viewpoint, a democratic viewpoint, or just another internet trolling?
Whether it's right, wrong, or just doom saying - certain points made sense, especially this quote from the end: "To show you how fragile our inflated lifestyle is, take stock at what you and others do for a living. Ask yourself how many of those jobs are essential for subsistence of life? Hardly any." I've been doing exactly that for at least the last 3 years, it's a question that arises in my head almost every hour in one form or another. I'm not scared of anything, I'm just fascinated. Sorry, I don't know who wrote it, just swiped it from one of the major trolling websites. _______________________________________________ The US, along with the rest of the world, is undergoing a classic contraction of spending and employment as the ratio of underlying legitimate productivity sags relative to amount of phony money being pumped into the system. It takes ever-increasing amounts of fiat currency to keep a bubble inflating. Even with major manipulation of the stock market, all the Powers That Be can hope for at this point is to create a soft landing; there will be no real recovery for many years, until real demand meets legitimate supply. Meanwhile, the downward spiral of job loss and underemployment will continue. November?s unemployment figures rose to 6%, despite continued claims that the economy is in recovery. Personal bankruptcies are running at an all-time high and mortgage foreclosures are rising sharply. I think we are seeing the first signs of a declining housing market--a bursting bubble that will take a lot of people down to position where they owe more on a house than it is worth on the market. Treasury Secretary O?Neill?s sudden decision to bail out of the Bush cabinet, along with top assistant Lawrence Lindsey may be an indication that he knows the real downhill slide is coming soon--and doesn?t want to be around to take the blame. The NY Times implies that both were "pushed" out. In any case, there is clearly some strong conflict amid top economic advisors on how to handle this collapsing bubble. It is helpful to keep in mind how much of the economy is real and how much is not real ? that is, how much perceived economic prosperity is due to the inflationary bubble of fiat money injection into the economy. While consumer spending is slacking, there is still plenty to go around. But don?t be lulled into a false sense of security. The real economic fall has yet to come. A large portion of people?s disposable income indirectly comes from federal money creation. For example, almost 75% of the money spent on the housing/construction market (which accounts for almost 30% of the GNP) is generated by debt ? not cash ? and financed by the Federal Reserve through discounted loans to banks or to its "private" partners in money creation, the federal mortgage lending agencies Fanny Mae and Freddie Mac, which provide massive liquidity for the housing markets. It used to be that home loans were scarce. Banks had to wait for savings to come in or for existing loans to be repaid before they had disposable funds to loan. Now, they simply get the money from the Fed through the discount window and remarket the loans to groups of investors. While this free-money machine isn?t likely to stop anytime soon, it will eventually lead to greater inflation, now that the world is flush with dollars and can?t absorb much more. The falling dollar value is indicative that the dollar is reaching saturation levels. As I have pointed out before, the world has been absorbing US inflation for years as the world economy has grown ? but that free outlet for surplus American dollars is beginning to taper off. Another aspect of the unreal economy is the credit card debt used to purchase many of the high-end items people buy. Debt, whether short-term or long-term, gives people the illusion of having more disposable income than they really do, especially if only minimal effort is made to pay off the principle balance of the debt. The illusion applies to government as well as consumer spending. Governments get away with delivering billions of your money in foreign aid and other wasteful measures simply because taxpayers never see the bill, personally. It?s just added to the national debt, which keeps getting passed on from generation to generation. But no debt can be postponed forever, and the final generation will be stuck with a balance much too high to repay and no means to postpone further the inevitable default. Right now, each person?s share is about $60,000. Obviously, even now it could never be repaid. Does that mean we never suffer the consequences to deficit spending and a loose money policy? No, but the consequences come back to bite us in a way that diverts the blame from the socialist spenders who got us into this mess, to the free market. In short, the inevitable monetary contraction shows up as a depression--for which the free market is blamed. Contrary to what your Keynesian high school text books tell you, we don?t owe the debt to ourselves. We owe it to those who own the debt ? half of whom are foreigners. What?s so bad about them losing their savings or investments as a result of our default? Simply that the money disappears from circulation, and never is spent here or abroad. The end result is a massive contraction of the money supply. A reverse multiplier comes into play, and declining money circulation eventually reaches backward into the economy where everyone feels its effect ? though not equally. First, a few lose their jobs. Then others, due to the decline in spending, then others. Declining tax revenues from sales and income taxes cause state employees to be laid off, who in turn spend less ? and so the cycle continues. The decline never descends below the survival level of subsistence living, because people will struggle for all their worth just to survive. Life at its worst in Soviet Russia proved that. But it?s no fun living with food shortages and uncertain housing. To show you how fragile our inflated lifestyle is, take stock at what you and others do for a living. Ask yourself how many of those jobs are essential for subsistence of life? Hardly any. They are artifacts of our rising standard of living and increased specialization. To the extent that these advances have been made as a result of real capital accumulation in the market, they are sustainable and laudable, as they allow greater velocity in the economy and increased efficiency. However, much of the highly accelerated advancement enjoyed by America over the past century has been financed by the bubble economy created by government fiat money inflation and easy credit policies. It is an unavoidable fact that at some point the bubble must burst, and the resulting contraction is by necessity all the more painful the larger the bubble was before it burst. Just as state governments have trouble deflating their employment rolls during decline revenue periods, people everywhere have trouble adjusting back downward to more useable professions and trades. In fact, the resistance to change is so difficult that many will turn to crime and violence rather than adjust. Don?t be caught unprepared for this inevitable retrenchment. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~| Archives: http://www.houseoffusion.com/cf_lists/index.cfm?forumid=5 Subscription: http://www.houseoffusion.com/cf_lists/index.cfm?method=subscribe&forumid=5 Signup for the Fusion Authority news alert and keep up with the latest news in ColdFusion and related topics. http://www.fusionauthority.com/signup.cfm Unsubscribe: http://www.houseoffusion.com/cf_lists/unsubscribe.cfm?user=89.70.5
