Posts
April 15th.
Is there an Ides of April? Beware the Ides of March but what about April? I don’t know but it is tax day. Today you settle up with Uncle Sam, paying your share of the Military, Social Security, health care for the poor (Medicaid), unemployment for those who are looking but can’t find a job, food stamps and all the other entitlement programs that we, as citizens of a civilized and refined country think we should have. While I am an admitted curmudgeon, I am not opposed to helping the helpless, assisting those who need help to get from where they are to where they need to be to become self supporting. I just wonder how much of the world we should be helping when we are borrowing money to pay for that help.
What is happening? Greedy pirates are taking ships left ands right. Aids is killing an entire generation in parts of Africa. Starvation is an on going problem around the world. There is a rising portion of our own people who are homeless. Greedy bankers and insurance executive have caused many to lose jobs. IBM is moving jobs to foreign countries at the rate of 5000 per quarter, adding to the unemployment ranks in the USA. Greedy politicians are lying their butts off (Dodd) and the lobbyists are running amuck.
Will the well intentioned but inexperienced Mr. Obama drive the USA off the cliff? Can he gain control from the likes of Nancy Pelosi and Chuck Shumer before something horrific happens and like the Soviet Union, the DotCom bubble, the housing bubble and the up coming US Treasury bubble, we implode and collapse. Will the mighty US dollar become like the German Mark after WWII when it took cartons of Marks to buy groceries. Think it can’t happen here? August 14, 1971 Gold was $35/oz. On April 14, 2009 Gold was $887.50/oz. An increase of 25.4 times in 38 years. If the dollar continues to lose value at the same rate going forward in 2047 (when those born in the 1980's are reaching retirement) gold will trade at $22,504/ oz. OK so Gold may be a bit unique. What about housing? In 1987 a house that sold for $650,000 in 2008 (after the peak) would have only cost about 134,400 according to the Case Shiller index. That is a rise of 4.8 times in just 20 years. Cars that cost $2900 in 1969 cost $20,000 today. 6.9 times more in just 40 years. Get the idea? Oh I just read a report that Energy Information Administration just announced that it expects gasoline to be about $2.23 during this summers driving season and peak at $2.30 in late summer. They must have just read my blog from March 18th. I said $2.50 by May. Let’s see who gets closer.
By the way the deficit for this (fiscal) year is nearly 1 Trillion so far which is about double where the deficit stood this time last year. I'm not sure this is the kind of change any of us wanted.
This is still the greatest country in the world however, and if you look at those same statistics for other western countries, it doesn’t look any different. The western world moves largely in lockstep on these things. Even Asia is largely coupled with the west if only because they export so much to the west that negative situations in west have a significant impact on Asia. The solution isn’t bailouts and Trilion dollar ($1,000,000,000,000 or $3 for every human in this country) plus yearly deficits. The solution is unwinding the excesses and getting our collective heads out of our behinds going forward.
