Understanding Government

I’m bound to offend people by starting this series of posts about politics. But I figure I’ve spend the last 18 months doing it already; continuing to do it isn’t going to change much. I still have the same group of friends, most people still seem to like me, so what do I have to loose, right? Read the rest of this entry »

A brilliant open letter written by Bretigne Shaffer says this:

I’m going to make some predictions about Obama’s presidency.  Essentially, I’m going to predict that four years from now, an Obama presidency will not look very different from the George W. Bush presidency, or from what I imagine a John McCain presidency would bring.  If I’m wrong about this, then I promise that I will re-think my beliefs about our political system and about politics generally.  But if I am right, then I’m asking you to do the same.  I’m asking each of you to consider the seemingly bizarre proposition that there really is no significant difference between candidates offered up by the established party system; that Republican and Democrat are virtually indistinguishable; and that neither party has at heart the interests of you or me or “the American people.”  I’m asking you to consider the possibility that continuing to vote for these people just helps to perpetuate the very ills you seek to cure.

I like this letter so much, that I’ll even agree to it’s terms – if Obama proves to be significantly different than Bush, I will rethink my political stands.

Economics and government are connected at the hip. If your economic model is screwed up then your government will end up being screwed up as well. The Bible talks about this several times, including in Leviticus, Proverbs, and Micah. However, the first time it shows up plainly is in Deuteronomy 25: 15-16 -

You must have accurate and honest weights and measures, so that you may live long in the land the God is giving you. God detests anyone who does these things, anyone who deals dishonestly.

Why is this important? Read the rest of this entry »

(it’ll be worse. Sorry.)

Here’s what bothers me – if (when) Eric deCarbonnel’s and the rest of the contrarian economists are proven right, they will continue to be ignored. How bad does it really need to get before people start to believe that we are in big trouble, that Obama will not be able to save us, that the worth of our money isn’t important, and that government isn’t the answer (but freedom, the market, and personal responsibility are)?

We’re following the same strategies that we followed the last time we were in this economic situation (that would be 1929 by the way). Mises.org hits on the head here:

They have looked at the history of the New Deal and completely misunderstood it, believing the civics-book claptrap about how FDR saved us from the Depression, whereas the fact is that FDR’s theories and policies lengthened and deepened it to the point that the only way out that the Roosevelt administration saw was war.

I found the term from a series of videos at Vimeo (via Coudal), but it seems to fit. In any case, welcome to The New Depression. I have to imagine that this is about what things looked like in 1929.

During the Senate discussions about the impending bailout of the banking system, Ron Paul questioned Bernanke’s authority to create money to purchase bad debt and take a gamble that they can get rid of it later. Bernanke’s response was that the Congress “is given the authority to coin money, and to regulate its value, and they delgated that to us [the Federal Reserve].” (in this video, at the 6:20 mark) Bernanke’s right, but he’s also very, very wrong. Here’s why. Read the rest of this entry »

via Wise Bread

Here’s the gist of it (well, a summary of a summary) – Ron Laszewski has created an economic model based on the Bureau of Economic Analysis’ definition of Peak Debt. When given data from 1925, when peak debt was last reached, Laszewski’s model correctly predicted the crash of 1929 and the subsequence decade long Great Depression. Bad news folks – we hit our peak debt in 2005. It seems to suggest that 2009 will be particularly rough, and the year following even worse.

Here’s my suggestion: don’t take on any more debt, pay off all the debt you can, and figure out how to cut your expenses to the bone. It’ll be much easier if you get to make those decisions under controlled circumstances than have them forced on you later.

Wise Bread is a great source to help get your finances under control.

I may be mentioning this fine woman in the future, but there’s a great interview with Naomi Wolf over at Democracy Now! about her book “The End of America.” In short, in the book she details the ten steps that are common in all downfalls of democracies.

Pay attention.

Just a quick heads up, the banking situation here in the US is not getting any better. In fact, the FDIC just closed it’s eighth bank for the year. Now, that may not seem like many, but consider the banks that have closed:

Bank::FDIC Payout::Uninsured desposits

First Priority::$200 million::$13 million
IndyMac::$4 billion
Hume Bank::$12.5 million::$1.1 million

In all, eleven banks have failed between Feb 2007 and August 2008. To put things in perspective, before Feb 2007 the FDIC hadn’t closed a bank since 2004 (see sources). We’re gonna have big problems here.

Sources
Bank Failures, Should You Be Worried?
Coming Bank Failures
FDIC Bracing for Bank Failures